As filed with the U.S. Securities and Exchange Commission on September 27, 2024.

Registration Statement No. 333-   

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM F-1

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

 

 

CROWN LNG HOLDINGS LIMITED

(Exact Name of Registrant as Specified in Its Charter)

 

 

Not Applicable

(Translation of Registrant’s name into English)

 

 

 

Jersey, Channel Islands		4924		Not Applicable
(State or Other Jurisdiction of Incorporation or Organization)		(Primary Standard Industrial Classification Code Number)		(I.R.S. Employer Identification Number)

37th Floor, 1

Canada Square, Canary

Wharf, London,

Greater London E14

5AA

United Kingdom

Telephone: +47 980 25 359

(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices)

 

 

Cogency Global Inc.

122 East 42nd Street, 18th Floor

New York, New York 10168

+1 800-221-0102

(Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent of Service)

 

 

Copies to:

Andrew M. Tucker, Esq.

Nelson Mullins Riley & Scarborough LLP

101 Constitution Avenue, NW. Suite 900

Washington, D.C. 20001

(202) 689-2800

 

 

Approximate date of commencement of proposed sale to the public: As soon as practicable after this registration statement becomes effective.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 (as amended, the “Securities Act”), check the following box. ☒

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration number of the earlier effective registration statement for the same offering. ☐

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933.

Emerging growth company ☒

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐

† The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

 

 

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act, or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

 

 

 

The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

 

PRELIMINARY PROSPECTUS

SUBJECT TO COMPLETION, DATED SEPTEMBER 27, 2024

CROWN LNG HOLDINGS LIMITED

Primary Offering of

17,346,632 Pubco Ordinary Shares

Secondary Offering of

31,120,801 Pubco Ordinary Shares

7,346,632 Pubco Warrants to Purchase Pubco Ordinary Shares

 

 

This prospectus relates to the offer and sale by Crown LNG Holdings Limited, (“us,” “we,” “Pubco” or the “Company”), of (i) up to 10,000,000 Pubco Ordinary Shares that are issuable by us upon exercise of 10,000,000 warrants, which were included in the units sold in the Catcha’s IPO, and were assumed by Pubco at the Closing (as defined below), with each whole warrant exercisable for one Ordinary Share at an exercise price of $11.50 per whole share, (ii) up to 5,333,333 Pubco Ordinary Shares that are issuable upon the exercise of 5,333,333 warrants, which were originally issued in a private placement simultaneously with Catcha’s IPO, and were assumed by Pubco at the Closing, with each whole warrant exercisable for one Ordinary Share at an exercise price of $11.50 per whole share, (iii) up to 1,865,799 of Ordinary Shares that are issuable by us upon exercise of 1,865,799 warrants issued to Catcha Holdings LLC (the “Sponsor”), and (iv) up to 147,500 Pubco Ordinary Shares that are issuable upon the exercise of 147,500 warrants issued to Helena Special Opportunities LLC (“Helena”), pursuant to the Securities Purchase Agreement dated as of June 4, 2024 between Helena and Crown (the “Securities Purchase Agreement”).

This prospectus also relates to the offer and sale from time to time, subject to the contractual lock-ups described in the Lock-up Agreements (“Lock-up Agreements”) of up to (i) up to 5,333,333 warrants, which were originally issued in a private placement simultaneously with Catcha’s IPO, and which were assumed by Pubco at the Closing, with each whole warrant exercisable for one Pubco Ordinary Share at an exercise price of $11.50 per whole share, (ii) 19,229,215 Pubco Ordinary Shares issued to insiders of Crown (such shareholders, the “Crown Legacy Holders”) who held securities of Crown prior to the closing (the “Closing”) of the business combination with Catcha (as further described herein, the “Business Combination”), (iii) 838,723 of our Ordinary Shares that were issued to the Sponsor upon conversion of 838,723 Catcha Class B ordinary shares, par value $0.0001 per share (“Class B Ordinary Shares”), of Catcha that were initially issued in a private placement prior to the IPO, (iv) 202,863 Pubco Ordinary Shares issued by us to certain accredited investors (the “PIPE Investors”) pursuant to subscription agreements entered May 6, 2024 and May 14, 2024, by and between Pubco, Catcha, and the PIPE Investors (“PIPE Agreements”), (v) up to 8,850,000 of our Ordinary Shares that are issuable to Helena through a private placement for the issuance of convertible notes (the “SPA Notes”), pursuant to the Securities Purchase Agreement, (vi) up to 147,500 warrants that are issuable to Helena, pursuant to the Securities Purchase Agreement, with each whole warrant exercisable for one Ordinary Share, (vii) up to 2,000,000 shares of Pubco ordinary shares that are issuable upon the exercise of the Cohen Convertible Note issued to J.V.B. Financial Group, LLC, which was issued in a principal amount of $1,000,000 and is convertible into Pubco Ordinary Shares based on a discount to prevailing market prices of the Pubco Ordinary Shares; and (viii) 1,865,799 warrants that are issuable to the Sponsor.

We are registering the offer and sale of these securities to satisfy certain registration rights we have granted. The Shareholders may offer all or part of the securities for resale from time to time through public or private transactions, at either prevailing market prices or at privately negotiated prices. These securities are being registered to permit the Shareholders to sell securities from time to time, in amounts, at prices and on terms determined at the time of offering. The Shareholders may sell these securities through ordinary brokerage transactions, in underwritten offerings, directly to market makers of our shares or through any other means described in the section entitled “Plan of Distribution” herein. In connection with any sales of securities offered hereunder, the Registered Shareholders, any underwriters, agents, brokers or dealers participating in such sales

may be deemed to be “underwriters” within the meaning of the Securities Act of 1933, as amended, or the Securities Act. We are registering these securities for resale by the Registered Shareholders, or their donees, pledgees, transferees, distributees or other successors-in-interest selling our Ordinary Shares, Warrants or interests in our Ordinary Shares, or Warrants received after the date of this prospectus from the Shareholders as a gift, pledge, partnership distribution or other transfer.

Certain securities held by the Catcha Founders, Crown Legacy Holders and the PIPE Investors are subject to contractual lock-up restrictions that prohibit them from selling such securities at this time. See the section of this prospectus entitled “Description of Securities.”

On July 9, 2024 (the “Closing Date”), we consummated the Business Combination contemplated by that certain Business Combination Agreement dated as of August 3, 2023 (as amended, the “BCA”), by and among the Company, Catcha Investment Corp, a Cayman Islands exempted company limited by shares (“Catcha”), CGT Merge II Limited, a Cayman Islands exempted company limited by shares (“Merger Sub”), and Crown LNG Holding AS, a private limited liability company incorporated under the laws of Norway (“Crown”). As a result of the Business Combination, Merger Sub has merged with and into Catcha (the “Merger”), with Catcha as the surviving company and becoming a wholly owned subsidiary of Pubco. Additionally, each (a) issued and outstanding Class A ordinary share, par value $0.0001 per share, of Catcha (“Catcha Class A Ordinary Shares”) was converted into the right to receive one newly issued ordinary share, no par value, of Pubco (together, the “Pubco Ordinary Shares” and each individually, a “Pubco Ordinary Share”), (b) issued and outstanding Class B ordinary share, par value $0.0001 per share, of Catcha (“Catcha Class B Ordinary Shares”) was converted into the right to receive one newly issued Pubco Ordinary Share, (c) outstanding and unexercised public and private placement warrants of Catcha were converted into one warrant of Pubco (“Pubco Warrants”) that entitles the holder thereof to purchase one Pubco Ordinary Share in lieu of one Catcha Class A Ordinary Share and otherwise upon substantially the same terms and conditions. Further, following the Merger, subject to the terms and procedures set forth under the Business Combination Agreement, the Crown shareholders transferred to Pubco, and Pubco acquired from the Crown Shareholders, all of the ordinary shares of Crown held by the shareholders in exchange for the issuance of Pubco Ordinary Shares.

In connection with Catcha’s extraordinary general meeting, held on June 12, 2024, holders of 1,138,361 shares of Catcha Class A Ordinary Shares, issued in Catcha’s IPO (the “Catcha public shares”) exercised their right to redeem their shares for cash at a price of approximately $11.64 per share, for an aggregate price of approximately $13.2 million, which represented approximately 83.4% of the total Catcha public shares then outstanding.

We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read this entire prospectus and any amendments or supplements carefully before you make your investment decision. Our Ordinary Shares and Warrants are listed on the Nasdaq Capital Market, (“Nasdaq”) under the trading symbols “CGBS” and “CGBSW,” respectively. On August 13, 2024, the closing prices for our Ordinary Shares and Warrants on the Nasdaq were $0.43 per share and $0.06 per warrant, respectively.

We are an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012 and are therefore eligible to take advantage of certain reduced reporting requirements applicable to other public companies.

We are also a “foreign private issuer” as defined in the Exchange Act and are exempt from certain rules under the Exchange Act that impose certain disclosure obligations and procedural requirements for proxy solicitations under Section 14 of the Exchange Act. In addition, our officers, directors and principal shareholders will be exempt from the reporting and “short-swing” profit recovery provisions under Section 16 of the Exchange Act. Moreover, we are not required to file periodic reports and financial statements with the SEC as frequently or as promptly as U.S. companies whose securities are registered under the Exchange Act.

We are a holding company incorporated in the under the laws of Jersey, Channel Islands, with our headquarters in Jersey, Channel Islands. Our operations are conducted in such headquarter and one of our

wholly owned subsidiaries in India. Throughout this prospectus, unless the context indicates otherwise, (1) references to “Pubco,” “we” or “us” refer to Crown LNG Holdings Limited, a private limited company incorporated under the laws of Jersey, Channel Islands, the registrant and the Jersey holding company that is the current holding company of the group, (2) references to “Crown” refer to Crown LNG Holding AS, a private limited liability company incorporated under the laws of Norway, a wholly owned subsidiary of Pubco, (3) references to “Catcha” refer to Catcha Investment Corp, a Cayman Islands exempted company limited by shares, a blank check company which has become a wholly owned subsidiary of Pubco as a result of the Business Combination, and (4) references to “Crown India” refer to Crown LNG India AS, a subsidiary of Pubco. For a diagram depicting Pubco’s corporate structure, see “Prospectus Summary-Overview-Structure of Pubco.”

Investors in our securities are investing in a Jersey, Channel Islands, holding company rather than securities of our operating subsidiaries. Such structure involves unique risks to investors. In particular, because some of our operations are conducted in India, we may face various legal and operational risks associated with doing business in India (as defined in this prospectus). For a detailed description of the risks related to Pubco’s holding company structure and doing business in India, see “Risk Factors-Risks Related to Legal and Regulatory Compliance.”

As of the date of this prospectus, neither Pubco nor any of its subsidiaries have made any dividends or distributions to their respective parent companies or to any investor, and the only transfers of cash among Pubco and its subsidiaries have been from Pubco to its subsidiaries for investments in its subsidiaries and for its subsidiaries’ working capital needs. As of July 31, 2024, we have transferred an aggregate of approximately 6.0 million through regular commercial banks via wire transfer (“in cash”) to Crown LNG Holdings Limited as capital injection, cash advanced for working capital and payments for the services fee, an aggregate of approximately $2.38 million in cash to GBTRON Limited as capital injection, an aggregate of approximately $1.61 million in cash to Crown LNG Holding AS (“Crown”). Other than the above transfers, there have been no transfers of any type of assets among us and our subsidiaries. Since our inception, no cash has been transferred from any of our subsidiaries to Pubco, and there has also been no cash transferred amongst our subsidiaries. See Pubco’s audited historical consolidated financial statements included elsewhere in this prospectus. Any determination to pay dividends will be at the discretion of our board of directors. Currently, we do not anticipate that we would distribute earnings even after we become profitable and generate cash flows from operations. We do not currently have any cash management policy that dictates how funds must be transferred between us and our subsidiaries, or among its subsidiaries. If needed, we may transfer funds to our subsidiaries, by way of capital contributions or loans in accordance with the charter of the relevant subsidiaries and in compliance with applicable local laws and regulations. As an offshore holding company, we may use the proceeds of our offshore fund-raising activities to provide loans or make capital contributions to our subsidiaries, in each case subject to the satisfaction of government reporting, registration and approvals.

 

 

Investing in our securities involves a high degree of risk. See “Risk Factors” beginning on page 18 of this prospectus for a discussion of information that should be considered in connection with an investment in our securities.

Neither the SEC nor any other regulatory body has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

 

 

PROSPECTUS DATED SEPTEMBER 27, 2024

TABLE OF CONTENTS

 

		Page
ABOUT THIS PROSPECTUS			1
FINANCIAL INFORMATION PRESENTATION			2
INDUSTRY AND MARKET DATA			3
TRADEMARKS, TRADENAMES AND SERVICE MARKS			4
FREQUENTLY USED TERMS			5
FORWARD-LOOKING STATEMENTS			8
PROSPECTUS SUMMARY			10
THE OFFERING			15
RISK FACTORS			18
CAPITALIZATION AND INDEBTEDNESS			45
UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION			46
USE OF PROCEEDS			63
DIVIDEND POLICY			64
MATERIAL TAX CONSIDERATIONS			65
MATERIAL JERSEY TAX CONSIDERATIONS			75
BUSINESS			77
CROWN’S MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS			96
MANAGEMENT OF CROWN			120
EXECUTIVE COMPENSATION			125
CERTAIN RELATIONSHIPS AND RELATED PERSON TRANSACTIONS			126
DESCRIPTION OF SECURITIES			137
BENEFICIAL OWNERSHIP OF SECURITIES			144
SELLING SECURITYHOLDERS			146
PLAN OF DISTRIBUTION			149
EXPENSES RELATED TO THE OFFERING			151
LEGAL MATTERS			151
EXPERTS			151
ENFORCEABILITY OF CIVIL LIABILITY UNDER U.S. SECURITIES LAWS			152
WHERE YOU CAN FIND MORE INFORMATION			153
INFORMATION NOT REQUIRED IN PROSPECTUS			II-1
SIGNATURES			II-7

You should rely only on the information contained or incorporated by reference in this prospectus or any supplement. Neither we nor the Registered Shareholders have authorized anyone else to provide you with different information. The securities offered by this prospectus are being offered only in jurisdictions where the offer is permitted. You should not assume that the information in this prospectus or any supplement is accurate as of any date other than the date on the front of each document. Our business, financial condition, results of operations and prospects may have changed since that date.

Except as otherwise set forth in this prospectus, neither we nor the Registered Shareholders have taken any action to permit a public offering of these securities outside the United States or to permit the possession or distribution of this prospectus outside the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about and observe any restrictions relating to the offering of these securities and the distribution of this prospectus outside the United States.

ABOUT THIS PROSPECTUS

This prospectus is part of a registration statement on Form F-1 that we filed with the SEC. The Registered Shareholders named in this prospectus may, from time to time, sell the securities described in this prospectus in one or more offerings. This prospectus includes important information about us, the securities being offered by the Registered Shareholders and other information you should know before investing. Any prospectus supplement may also add, update, or change information in this prospectus. If there is any inconsistency between the information contained in this prospectus and any prospectus supplement, you should rely on the information contained in that particular prospectus supplement. This prospectus does not contain all of the information provided in the registration statement that we filed with the SEC. You should read this prospectus together with the additional information about us described in the section below entitled “Where You Can Find More Information.” You should rely only on information contained in this prospectus, any prospectus supplement and any related free writing prospectus. We have not, and the Registered Shareholders have not, authorized anyone to provide you with information different from that contained in this prospectus, any prospectus supplement and any related free writing prospectus. The information contained in this prospectus is accurate only as of the date on the front cover of the prospectus. You should not assume that the information contained in this prospectus is accurate as of any other date.

The Registered Shareholders may offer and sell the securities directly to purchasers, through agents selected by the Registered Shareholders, or to or through underwriters or dealers. A prospectus supplement, if required, may describe the terms of the plan of distribution and set forth the names of any agents, underwriters or dealers involved in the sale of securities. See “Plan of Distribution.”

This prospectus does not constitute an offer to sell, or a solicitation of an offer to buy, any securities, or the solicitation of a proxy, in any jurisdiction to or from any person to whom it is unlawful to make any such offer or solicitation in such jurisdiction.

 

1

FINANCIAL INFORMATION PRESENTATION

Pubco

All of our financial information included in this prospectus is presented in U.S. dollars, except as otherwise indicated. We qualify as a “foreign private issuer” under the Exchange Act, and we prepare our financial statements in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board. IFRS differs in certain material respects from U.S. generally accepted accounting principles (“U.S. GAAP”) and, as such, our financial statements are not comparable to the financial statements of U.S. companies prepared in accordance with U.S. GAAP. Following the Closing of the Business Combination, the historical assets and liabilities of the Company will be those of Crown.

Catcha

The historical financial statements of Catcha were prepared in accordance with the generally accepted accounting principles in the United States, or U.S. GAAP and are reported in U.S. Dollars.

 

2

INDUSTRY AND MARKET DATA

This prospectus contains industry data, information and statistics regarding the markets in which we operate as well as publicly available information, industry and general publications and research and studies conducted by third parties. This information is supplemented where necessary with our own internal estimates and information obtained from other sources, taking into account publicly available information about other industry participants and our management’s judgment where information is not publicly available. This information appears in “Prospectus Summary,” “Business” and “Crown’s Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and other sections of this prospectus.

Forecasts and other forward-looking information obtained from these sources are subject to the same qualifications and uncertainties as the other forward-looking statements in this prospectus. These forecasts and forward-looking information are subject to uncertainty and risk due to a variety of factors, including those described under “Risk Factors.” These and other factors could cause results to differ materially from those expressed in any forecasts or estimates.

 

3

TRADEMARKS, TRADENAMES AND SERVICE MARKS

We and our respective subsidiaries own or have proprietary rights to trademarks, trade names and service marks used in this prospectus in connection with the operation of their businesses, many of which are registered under applicable intellectual property laws. In addition, their names, logos and website names and addresses are their trademarks or service marks. Solely for convenience, trademarks and trade names referred to in this prospectus may appear without the “^®” or “^™”symbols, but the lack of such symbols is not intended to indicate, in any way, that we or the owners will not assert, to the fullest extent possible under applicable law, our rights or the rights of the applicable licensor to these trademarks and trade names. The use or display herein of other companies’ trademarks, trade names or service marks is not intended to imply a relationship with, or endorsement or sponsorship by us or any other companies, or a sponsorship or endorsement of any such other companies by us. Each trademark, trade name or service mark of any other company appearing in this prospectus is the property of its respective holder.

 

4

FREQUENTLY USED TERMS

The following terms used in this prospectus have the meanings indicated below:

 

•

“Business Combination” means the transactions contemplated by the Business Combination Agreement including, without limitation, the Merger;

 

•

“Business Combination Agreement” means the Business Combination Agreement, dated as of August 3, 2023, by and among Catcha, Pubco, Merger Sub, and Crown, as amended on October 2, 2023 and as further amended on January 31, 2024, February 16, 2024, May 21, 2024, June 11, 2024 and June 28, 2024;

 

•

“Catcha,” “means Catcha Investment Corp, a Cayman Islands exempted company limited by shares;

 

•

“Catcha Board” means Catcha’s board of directors;

 

•

“Catcha Class A Ordinary Shares” means the Class A ordinary shares, par value $0.0001 per share, of Catcha;

 

•

“Catcha Class B Ordinary Shares” or “founder shares” means the Class B ordinary shares, par value $0.0001 per share, of Catcha that were initially issued to our Sponsor in a private placement prior to our initial public offering;

 

•

“Catcha Ordinary Shares” means Catcha Class A Ordinary Shares and Catcha Class B Ordinary Shares;

 

•

“Catcha Warrant Agreement” means the warrant agreement, dated February 11, 2021, between Catcha and Continental, as warrant agent, which sets forth the expiration and exercise price of and procedure for exercising the warrants;

 

•

“Charter” means the Memorandum and Articles of Association of Crown LNG Holdings Limited;

 

•

“Closing” means the closing of the Business Combination;

 

•

“Closing Date” means July 9, 2024, in accordance with the Business Combination Agreement;

 

•

“Continental” means Continental Stock Transfer & Trust Company;

 

•

“Crown” means Crown LNG Holding AS, a private limited liability company incorporated under the laws of Norway;

 

•

“Crown India AS” means Crown LNG India AS, a subsidiary of Crown and a private limited liability company incorporated under the laws of Norway;

 

•

“Crown India Limited” means Crown LNG India Limited (formerly known as Asia First Holdings Limited), a private company with limited liability incorporated in Hong Kong and a subsidiary of Crown India AS;

 

•

“Crown Shareholders” means the holders of Crown common stock immediately prior to the Exchange;

 

•

“Effective Time” means the time at which the Merger becomes effective in accordance with the Plan of Merger and the Cayman Islands Companies Act;

 

•

“Exchange” means the transfer from the Crown Shareholders to Pubco, and acquisition by Pubco from the Crown Shareholders, of all the Crown Shareholders’ shares of Common Stock in exchange for the issuance of Pubco Ordinary Shares on the first (1st) business day following the Merger Effective Date, subject to the terms and procedures set forth in the Business Combination Agreement;

 

•

“Exchange and Support Agreement” means the Exchange and Support Agreement, dated as of August 3, 2023, by and among Catcha, Pubco, Crown and certain Crown Shareholders, as may be amended, supplemented or otherwise modified from time to time;

 

5

•

“initial public offering” means Catcha’s initial public offering that was consummated on February 17, 2021;

 

•

“Jersey Companies Law” means the Companies (Jersey) Law 1991, as amended;

 

•

“Merger” means, pursuant to the Business Combination Agreement, the merger of Merger Sub into Catcha, with Catcha surviving the Merger as a wholly owned subsidiary of Pubco;

 

•

“Merger Effective Date” means July 9, 2024, the date on which the Merger became effective pursuant to the Business Combination Agreement;

 

•

“Merger Sub” means CGT Merge II Limited, a Cayman Islands exempted company limited by shares;

 

•

“Nasdaq” means the Nasdaq Stock Market;

 

•

“PIPE financing” means any investment into or financing of, either directly or indirectly, Pubco through purchase of Pubco Ordinary Shares, purchase of securities that are convertible or exchangeable into Pubco Ordinary Shares or other forms of investment or financing in connection with the Business Combination;

 

•

“private placement warrants” means the warrants outstanding as of the date of this proxy statement/prospectus that were issued to the Sponsor simultaneously with the consummation of Catcha’s initial public offering, each such whole warrant representing the right to purchase one private placement share;

 

•

“pro forma” means giving pro forma effect to the Business Combination, including any other equity financing transactions which may be entered into prior to the Closing;

 

•

“Pubco” means Crown LNG Holdings Limited, a private limited company incorporated under the laws of Jersey, Channel Islands;

 

•

“Pubco Board” means the board of directors of Pubco;

 

•

“Pubco Ordinary Shares” means the no par value ordinary shares in the capital of Pubco;

 

•

“Pubco Preferred Shares” means the no par value preference shares in the capital of Pubco;

 

•

“public shareholders” means holders of public shares, whether acquired in Catcha’s initial public offering or acquired in the secondary market;

 

•

“public shares” means the 226,521 Catcha Class A Ordinary Shares that were sold as part of the Catcha Units in Catcha’s initial public offering, whether acquired in Catcha’s initial public offering or acquired in the secondary market;

 

•

“public warrants” means the redeemable warrants to purchase Catcha Class A Ordinary Shares that were sold as part of the Catcha Units in its initial public offering or acquired in the secondary market;

 

•

“redemption” means each redemption of public shares for cash pursuant to the Existing Governing Documents;

 

•

“SEC” means the U.S. Securities and Exchange Commission;

 

•

“Securities Act” means the Securities Act of 1933, as amended;

 

•

“Special Resolution” has the meaning set out in the Jersey Companies Law being a resolution passed by the affirmative vote of at least two-thirds of the votes cast by the holders present in person or represented by proxy at a general meeting and entitled to vote on such matter, assuming a quorum is present;

 

•

“Sponsor” means Catcha Holdings LLC, a Cayman Islands limited liability company, which is affiliated with certain of Catcha’s directors and officers;

 

•

“transfer agent” means Continental;

 

6

•

“Trust Account” means the trust account established at the consummation of Catcha’s initial public offering that holds the proceeds of Catcha’s initial public offering and from the sale of private placement warrants and is maintained by Continental, acting as trustee;

 

•

“underwriter” means J.P. Morgan Securities LLC, Catcha’s underwriter in the initial public offering;

 

•

“units” or “Catcha Units” means the units of Catcha, each of which represented one Catcha Class A Ordinary Share and one-third of one warrant, with such whole warrant representing the right to acquire one Catcha Class A Ordinary Share, that were offered and sold by Catcha in Catcha’s initial public offering and in its concurrent private placement; and

 

•

“warrants” means the public warrants and the private placement warrants.

 

7

FORWARD-LOOKING STATEMENTS

This prospectus contains forward-looking statements. Forward-looking statements provide our current expectations or forecasts of future events. Forward-looking statements include statements about our expectations, beliefs, plans, goals, objectives, intentions, assumptions and other statements that are not historical facts. Forward-looking statements may be identified by the use of words such as “estimate,” “plan,” “project,” “forecast,” “intend,” “will,” “expect,” “anticipate,” “believe,” “seek,” “target” or other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward-looking statements include, but are not limited to, statements regarding our expectations, hopes, beliefs, intentions or strategies regarding the future including, without limitation, statements regarding: plans for preclinical studies, clinical trials and research and development programs; the anticipated timing of the results from those studies and trials; expectations regarding regulatory approvals, and our expectations with respect to future performance. Forward-looking statements are based on current expectations and assumptions that, while considered reasonable by us and our management, as the case may be, are inherently uncertain. These statements are based on various assumptions, whether or not identified herein, and on the current expectations of our management and are not predictions of actual performance. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, and must not be relied on by any investor as, a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond our control.

Forward-looking statements appear in a number of places in this prospectus including, without limitation, in the sections entitled “Business” and “Crown’s Management’s Discussion and Analysis of Financial Condition and Results of Operations.” The risks and uncertainties include, but are not limited to:

 

•

the ability of Pubco to realize the benefits expected from the Business Combination and to maintain the listing of the Pubco Ordinary Shares on Nasdaq;

 

•

changes in global, regional or local business, market, financial, political and legal conditions, including the development, effects and enforcement of laws and regulations and the impact of any current or new government regulations in the United States, U.K., and India affecting Pubco’s operations and the continued listing of Pubco’s securities;

 

•

Pubco’s success in retaining or recruiting, or changes required in, its officers, key employees or directors;

 

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factors relating to the business, operations and financial performance of Pubco, including, but not limited to:

 

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substantial doubt about Crown’s ability to continue as a going concern;

 

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the global market and demand for natural gas, liquefied natural gas (“LNG”), and liquefication and re-gasification services;

 

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Pubco’s ability and market opportunity to supply LNG infrastructure to under-served markets around the world;

 

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cyclical or other changes in the demand for LNG and natural gas;

 

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Crown’s inability to complete the development and/or construction of terminals, including the Kakinada Project, the Grangemouth Project, the Vung Tau Project, and the Newfoundland Project;

 

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Crown’s inability to secure and retain liquefaction and re-gas customers and/or as well as to secure terminal development opportunities in India, Bangladesh, the U.K., the Gulf of Mexico and other locations;

 

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Crown’s dependence on third-party contractors, operators and suppliers for the development, construction, installation and commissioning of Crown’s LNG terminals and associated assets;

 

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disruptions to the supply of natural gas to or from Crown’s LNG terminals and associated facilities;

 

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potential incidents involving health, safety, property or environmental consequences involving any of Crown’s LNG terminals;

 

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the failure of exported LNG to be a long-term competitive source of energy for international markets;

 

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Crown’s inability to obtain additional capital on acceptable terms as it grows its business;

 

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increased labor costs associated with the unavailability of skilled workers or Crown’s failure to attract and retain qualified personnel; and

 

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the other matters described in the section entitled “Risk Factors” beginning on page [ ].

Forward-looking statements are subject to known and unknown risks and uncertainties and are based on potentially inaccurate assumptions that could cause actual results to differ materially from those expected or implied by the forward-looking statements. Actual results could differ materially from those anticipated in forward-looking statements for many reasons, including the factors described in “Risk Factors” in this prospectus. Accordingly, you should not rely on these forward-looking statements, which speak only as of the date of this prospectus. We undertake no obligation to publicly revise any forward-looking statement to reflect circumstances or events after the date of this prospectus or to reflect the occurrence of unanticipated events. You should, however, review the factors and risks we describe in the reports we will file from time to time with the SEC after the date of this prospectus.

In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based on information available to us as of the date of this prospectus. And while we believe that information provides a reasonable basis for these statements, that information may be limited or incomplete. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all relevant information. These statements are inherently uncertain, and you are cautioned not to unduly rely on these statements.

Although we believe the expectations reflected in the forward-looking statements were reasonable at the time made, it cannot guarantee future results, level of activity, performance or achievements. Moreover, neither we nor any other person assumes responsibility for the accuracy or completeness of any of these forward-looking statements. You should carefully consider the cautionary statements contained or referred to in this section in connection with the forward looking statements contained in this prospectus and any subsequent written or oral forward-looking statements that may be issued by us or persons acting on our behalf.

 

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RISK FACTORS

In addition to the other information contained in this prospectus, including the matters addressed under the heading “Forward-Looking Statements,” you should carefully consider the following risk factors presented in this prospectus. The risk factors described below disclose both material and other risks, and are not intended to be exhaustive and are not the only risks facing us. Additional risks not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition, results of operations and cash flows in future periods or are not identified because they are generally common to businesses.

The occurrence of one or more of the events or circumstances described in these risk factors, alone or in combination with other events or circumstances, may have a material adverse effect on our business, financial condition, results of operations, cash flows and future prospects, in which event the market price of our securities could decline, and you could lose part or all of your investment.

Risks Related to Our Business

Cyclical or other changes in the demand for and price of LNG and natural gas may adversely affect our LNG business and the performance of our customers and could have a material adverse effect on our business, contracts, financial condition, operating results, cash flow, liquidity, and prospects.

Our LNG terminal business and the development of LNG terminals generally is based on assumptions about the future availability and demand for natural gas and LNG and the prospects for international natural gas and LNG markets. Demand for natural gas and LNG has been, and is likely to continue to be, volatile and subject to wide fluctuations in response to one or more of the following factors:

 

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competitive liquefaction capacity globally;

 

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insufficient or oversupply of natural gas liquefaction or receiving capacity worldwide;

 

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insufficient LNG tanker capacity;

 

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weather conditions, including temperature volatility resulting from climate change, and extreme weather events may lead to unexpected distortion in the balance of international LNG supply and demand;

 

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reduced demand resulting from spikes in prices for natural gas which could result in substitution of other fuels for gas;

 

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increased natural gas production deliverable by pipelines, which could suppress demand for LNG;

 

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decreased oil and natural gas exploration activities which may decrease the production of natural gas, including as a result of any potential ban on production of natural gas through hydraulic fracturing;

 

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changes in supplies of, and prices for, alternative energy sources which may reduce the demand for natural gas;

 

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changes in regulatory, tax or other governmental policies regarding imported LNG, natural gas or alternative energy sources, which may reduce the demand for imported LNG and/or natural gas;

 

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political conditions in customer regions;

 

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sudden decreases in demand for LNG as a result of natural disasters or public health crises, including the occurrence of a pandemic, and other catastrophic events;

 

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adverse relative demand for LNG compared to other energy sources, which may decrease LNG demand; and

 

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cyclical trends in general business and economic conditions that cause changes in the demand for natural gas.

Adverse trends or developments affecting any of these factors could result in decreases in the long-term demand of LNG and/or natural gas, which could materially and adversely affect our ability to secure future contracts and hence have a material adverse effect on our business, contracts, financial condition, operating results, cash flow, liquidity, and prospects.

Our ability to complete the development and/or construction of terminals, including the Kakinada Project, the Grangemouth Project, the Vung Tau Project, and the Newfoundland Project, will be contingent upon our ability to obtain additional funding. If we are unable to obtain sufficient funding, we may be unable to fully execute its business strategy.

We have pursued and are pursuing re-gas and liquefaction project opportunities and other projects along the LNG value chain. As described further in the section entitled “Crown’s Management’s Discussion and Analysis of Financial Condition and Results of Operations,” we are currently developing the Kakinada Project, the Grangemouth Project, the Vung Tau Project and the Newfoundland Project, which are additional offshore terminals with varied expected total production capacities. The commercial development of an LNG facility takes a number of years and requires a substantial capital investment that is dependent on sufficient funding and commercial interest, among other factors.

We will require significant additional funding to be able to complete the construction of the foregoing terminals, and any additional expansion projects, which we may not be able to obtain at a cost that results in positive economics, or at all. The inability to achieve acceptable funding may cause a delay in the development or construction of the foregoing terminals or any additional expansion projects, and we may not be able to complete our business plan, which could have a material adverse effect on our business, contracts, financial condition, operating results, cash flow, liquidity, and prospects.

Our long-term profitability depends on our ability to secure and retain liquefaction and re-gasification customers and/or as well as to secure terminal development opportunities in areas such as India, Bangladesh, the U.K., the Gulf of Mexico and other locations. If we are unsuccessful, the demand for our services and operations could decrease, which could materially and adversely affect Crown’s financial condition, cash flow, liquidity, and prospects.

While we do not engage in the purchase or sale of natural gas or LNG, our customers do engage in this business and our revenues and operating income from liquefaction, storage and re-gas services will be dependent on their success. In order for our business to be profitable, global demand for imported natural gas via LNG must be maintained and continue to grow.

Furthermore, our ability to develop new LNG liquefaction and re-gas terminals is uncertain and can be negatively affected by a number of factors, including:

 

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equipment failures or accidents;

 

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compliance with unanticipated governmental requirements;

 

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shortages or delays in the availability or delivery of appropriate equipment; industrial action;

Significant increases in the capital cost of a new liquefaction or re-gasification terminal beyond the amounts we estimate could impact the commercial viability of the project as well as require additional sources of financing to fund our operations until the applicable project is fully constructed (which could cause further delays), thereby negatively impacting our business and limiting its growth prospects. Cost overruns or construction delays (and factors giving rise to such events in the future) may be outside of our control and could have a material adverse effect on our current or future business, contracts, financial condition, operating results, cash flow, liquidity, and prospects.

 

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We depend on third-party contractors, operators and suppliers for the development, construction, installation and commissioning of our LNG terminals and associated assets.

We depend on third-party contractors, equipment manufacturers and suppliers for the development, construction, installation and commissioning of our LNG terminals and associated assets (such as pipelines to and from the terminals, metering stations, etc.). We have not yet entered into binding contracts for the construction, installation and commissioning of any LNG terminals and related assets, and we cannot assure you that we will be able to enter into the contracts required on commercially favorable terms, if at all, which could expose us to fluctuations in pricing and potential changes to our planned schedule. If we are unable to enter into favorable contracts, we may not be able to construct and operate these assets as expected, or at all. Furthermore, these agreements will be the result of arms-length negotiations and subject to change. There can be no assurance that contractors and suppliers will perform their obligations successfully under their agreements with us. If any contractor is unable or unwilling to perform according to the negotiated terms and timetable of its respective agreement or for any reason or terminates its agreement for any reason, we would be required to engage a substitute contractor, which could be particularly difficult in certain of the markets in which we plan to operate. Although we expect to include in our EPCIC agreements fixed-price, date-certain, turnkey provisions as well as substantial liquidated damages if the contractor or supplier fails to perform in the manner required with respect to its obligations, the events that trigger a cost overrun, delay or impairment in the completion or operation of the terminal, may extend the required date for completion; and any liquidated damages that we receive may be delayed or insufficient to cover the damages that we suffer as a result of any such delay or impairment, including, among others, any covenants or obligations by us to pay liquidated damages or penalties under our agreements with our customers to provide liquefaction, storage or re-gas services, as well as increased expenses or reduced revenue. Such liquidated damages from our EPCIC contractors may also be subject to caps on liability, and we may not have full protection to seek payment from our contractors to compensate us for such payments and other consequences. We may hire contractors to perform work in jurisdictions where they do not have previous experience, or contractors we have not previously hired to perform work in jurisdictions we are beginning to develop, which may lead to such contractors being unable to perform according to its respective agreement. Furthermore, we may have disagreements with our contractors about different elements of the construction process, which could lead to the assertion of rights and remedies under their contracts and increase the cost of the applicable facility or result in a contractor’s unwillingness to perform further work. If we are unable to construct and commission our terminals and related assets as expected, or, when and if constructed, they do not accomplish our goals, or if we experience delays or cost overruns in construction, our business, operating results, cash flows and liquidity could be materially and adversely affected.

Disruptions to the supply of natural gas to or from our LNG terminals and associated facilities could have a material adverse effect on our business, contracts, financial condition, operating results, cash flow, liquidity and prospects.

We will depend upon third-party pipelines and other facilities that either provide gas delivery to our planned LNG liquefaction terminals or pipelines to evacuate gas from our LNG storage and re-gas terminals. If the construction of new or modified pipeline connections, power plants or other facilities is not completed on schedule or any pipeline connection, power plant or other facility were to become unavailable for current or future volumes of natural gas due to repairs, damage to the facility, lack of capacity or any other reason, our ability to meet our liquefaction, storage or re-gas obligations could be restricted. While we seek to enter into “take-or-pay” and “use-or-pay” style contracts with our customers which are intended to insulate us from such disruptions outside of our control, certain events could result in a reduction in our revenues which could have a material adverse effect on our business, contracts, financial condition, operating results, cash flow, liquidity and prospects.

 

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Our contracts with customers are subject to termination under certain circumstances.

While we seek to enter into “take-or-pay” and “use-or-pay” style contracts with our customers, our Terminal Use Agreements (“TUAs”) contain clauses which allow for delayed payment or even termination is certain cases, including, without limitation:

 

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events of force majeure;

 

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at the end of a specified time period following certain events of force majeure or the outbreak of war;

 

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extended unexcused service interruptions or deficiencies;

 

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loss of or requisition of the GBS;

 

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the occurrence of an insolvency event; and

 

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the occurrence of certain uncured, material breaches.

In the event that one or more of these events arise, we may not be able to replace these customers with contracts on desirable terms, or at all, if they are terminated prior to the end of their terms. Contracts that we enter into in the future may contain similar provisions. In addition, our customers may choose not to extend existing contracts. As a result, we may have underutilized f terminals. If any of our current or future contracts are terminated prior to the end of their terms, such termination could have a material adverse effect on our business, contracts, financial condition, operating results, cash flows, liquidity and prospects.

The operation of GBSs and other LNG infrastructure assets is inherently risky, and an incident involving health, safety, property or environmental consequences involving any of our LNG terminals could harm our reputation, business and financial condition.

An accident or incident involving any of our facilities could result in any of the following:

 

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damage or loss to our LNG terminals, the LNG and natural gas onboard and our other facilities due to marine disasters; piracy; environmental incidents; bad weather; mechanical failures; earthing, fire, explosions and collisions; human error; and war and terrorism.

 

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death or injury to persons, loss of property or damage to the environment, natural resources or protected species, and associated costs;

 

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delays in taking delivery of an LNG cargo or discharging natural gas as applicable;

 

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suspension or termination of customer contracts, and resulting loss of revenues;

 

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governmental fines, penalties or restrictions on conducting business;

 

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higher insurance rates; and

 

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damage to our reputation and customer relationships generally.

Any of these results could have a material adverse effect on our business, financial condition and results of operations.

If our facilities suffer damage, they may need to be repaired. The costs of terminals and other infrastructure repairs are unpredictable and can be substantial. We may have to pay repair costs that our insurance policies do not cover, for example, due to insufficient coverage amounts or the refusal by our insurance provider to pay a claim. The loss of earnings while these terminals or other facilities are being repaired, as well as the actual cost of these repairs not otherwise covered by insurance, would materially adversely affect our business, financial condition and results of operations.

 

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We may experience operational problems with our LNG terminals and associated assets that could reduce revenue, increase costs or lead to termination of our customer contracts.

The structure supporting GBS terminals are complex and their operations are technically challenging. The operation of our GBS terminals may be subject to mechanical risks. Operational problems may lead to loss of revenue or higher than anticipated operating expenses or require additional capital expenditures. Moreover, pursuant to each customer contract, our GBS terminals, as applicable, must maintain certain specified performance standards, which may include a guaranteed delivery of natural gas, consumption of no more than a specified amount of fuel or a requirement not to exceed a maximum average daily cargo boil-off. If Crown fails to maintain these standards, Crown may be liable to our customers for damages and certain liquidated damages payable under our TUAs with customers, and in certain circumstances, our customers may terminate their respective contracts with us. Any of these results could harm our business, financial condition and results of operations.

We may experience cancellations, time delays, unforeseen expenses and other complications while developing our LNG terminals. These complications can delay the commencement of revenue-generating activities, reduce the amount of revenue Crown earn and increase our development costs.

Development projects, including our LNG terminals and associated assets, are often developed in multiple stages involving commercial and governmental negotiations, site planning, due diligence, permit requests, environmental impact studies, permit applications and review, marine logistics planning and transportation and end-user delivery logistics. These types of projects are subject to a number of risks that may lead to delay, increased costs and decreased economic attractiveness. These risks are often increased in foreign jurisdictions, where legal processes, language differences, cultural expectations, currency exchange requirements, political relations, changes in administrations, new regulations, regulatory reviews, employment laws and diligence requirements can make it more difficult, time-consuming and expensive to develop a project.

A primary focus of our business is the development of projects in foreign jurisdictions, including in jurisdictions where we may not have significant experience, and we expect to continue expanding into new jurisdictions in the future. Our inexperience in certain jurisdictions creates a meaningful risk that we may experience delays, unforeseen expenses or other obstacles that will cause the projects we are developing to take longer and be more expensive than our initial estimates.

We have not yet completed contracting, construction and commissioning of our planned initial two LNG re-gasification terminals. There can be no assurance that our LNG re-gasification (or future liquefication) terminals will operate as expected, or at all.

We have not yet entered into binding construction contracts, issued a “final notice to proceed” or obtained all necessary environmental, regulatory, construction and zoning permissions for our planned first LNG re-gasification terminals. There can be no assurance that we will be able to enter into the contracts required for the development of these re-gasification terminals on commercially favorable terms, if at all, or that we will be able to obtain all of the environmental, regulatory, construction and zoning permissions we need. In particular, we will require approval from local authorities for our initial LNG re-gasification (and future liquefaction) terminals in order to deliver (or liquefy) natural gas for our customers. If we are unable to enter into favorable contracts or to obtain the necessary regulatory and land use approvals on favorable terms, we may not be able to construct and operate these LNG terminals as expected, or at all. Additionally, the construction of LNG terminals is inherently subject to the risks of cost overruns and delays. There can be no assurance that we will not need to make adjustments to our liquification and re-gasification terminals as a result of the required testing or commissioning of each project, which could cause delays and be costly. If we are unable to construct, commission and operate all of our LNG terminals and other facilities as expected, or, when and if constructed, they do not accomplish our goals, or if we experience delays or cost overruns in construction, our business, operating results, cash flows and liquidity could be materially and adversely affected. We may also decide to

 

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delay, postpone or discontinue a project in order to prioritize a different project from the one which we originally planned. Expenses related to our pursuit of contracts and regulatory approvals related to our liquefication and re-gasification terminals and other facilities still under development may be significant and will be incurred by us regardless of whether these assets are ultimately constructed and operational.

Failure of exported LNG to be a long-term competitive source of energy for international markets could adversely affect our customers and could materially and adversely affect our business, contracts, financial condition, operating results, cash flow, liquidity, and prospects.

Our operations will be dependent upon LNG being a competitive source of energy in the markets in which we operate. Political instability in foreign countries that import or export natural gas, or strained relations between such countries and LNG exporting countries such as the United States, may also impede the willingness or ability of LNG purchasers or suppliers and merchants in such countries to import LNG from certain countries such as the United States.

It is expected that global demand for natural gas and LNG will continue to increase as nations seek more abundant, reliable, and environmentally cleaner fuel alternatives to fossil fuel energy sources such as oil and coal. However, there is currently renewed interest in fission power (nuclear) around the world focused on small modular reactors (“SMRs”) and molten salt reactors (“MSRs”) some of which are fast-build, passive-safe (cannot melt down) and extremely low cost. If such new fission technologies were to gain wide acceptance and be deployed on a large scale, this trend could represent a significant challenge to the LNG industry, and us in particular, as customers switch to cheaper, cleaner fission power.

As a result of the factors described above and other factors, LNG may not remain a long-term competitive source of energy internationally. Such a development would serve as a significant impediment to our ability to find customers which need our liquefaction, storage and re-gas services. This would, in turn, have a material adverse effect on our customers and on our business, contracts, financial condition, operating results, cash flow, liquidity and prospects.

We are subject to competition in all of our markets from competitors, some of which have significantly greater resources, technology, relationships or expertise.

While we intend to focus on GBS solutions for LNG markets with harsh weather, security, land acquisition or cost issues making floating or land-based solutions uncompetitive, the market for our LNG terminals is highly competitive and is subject to rapid technological changes and evolving customer demands and needs. We compete on the basis of various factors, including the quality of our GBS technology versus the technologies utilized by our competitors, our ability to secure year-round operating licenses and our ability to develop our terminals faster than the land-based competition. However, our competitors may be able to present attractive alternatives to our GBS technology in certain markets. There can be no assurance that customers will not select a land-based or floating solution even if it is not the optimal approach.

Many of our principal competitors are established companies that have substantial financial resources, recognized brands, technological expertise and market experience, and these competitors sometimes have more established positions in certain geographies than we do. Our competitors may be able to adopt new or emerging technologies or address customer requirements more quickly than we can. New and emerging technologies can also have the impact of allowing new companies to enter the market more quickly than they would have been able to in the past. We may also face increased competition from companies that could pose a threat to its business by providing more in-depth offerings, adapting their businesses to meet the demands of their customers, or combining with one of its competitors to enhance their businesses. A number of Crown’s principal competitors may continue to make acquisitions as a means to improve their competitiveness in the LNG industry.

 

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Our need for future financing may result in the issuance of additional securities, which will cause investors to experience dilution.

Our cash requirements may vary from those now planned. We expect our expenses to increase if and when we commence development of our projects. Accordingly, we will need to obtain substantial additional funding in connection with our continuing operations. Our securities may be offered to other investors at a price lower than the price per share offered to current shareholders, or upon terms which may be deemed more favorable than those offered to current shareholders. In addition, the issuance of securities in any future financing may dilute an investor’s equity ownership and have the effect of depressing the market price for our securities. Moreover, we may issue derivative securities, including options and/or warrants, from time to time, to procure qualified personnel or for other business reasons. The issuance of any such derivative securities, which is at the discretion of our board of directors, may further dilute the equity ownership of our shareholders.

Crown will require additional capital as it grows its business, and such capital may not be available on acceptable terms, or at all, which would result in Crown being unable to grow, or maintain its business.

While Crown intends to fund the majority of our capital requirements at the project level via strategic-financial equity and non-recourse project finance debt, to the extent that these sources become unavailable at acceptable terms we may need to access the capital markets or otherwise obtain additional funds to complete our LNG terminals. This could result in further dilution of Crown shareholders. There can be no assurance that the capital markets will be open and available for Crown to fund our LNG terminals via additional share issuances. Moreover, the bank and debt capital markets may not be open to Crown as a funding source since we are a pre-revenue company. In summary, we do not know when or if the capital markets will permit Crown to raise additional funds to fund our project level capital needs in a timely manner, on acceptable terms, or at all. Inability to access the capital markets, or the availability of capital only on less-than-favorable terms, may force Crown to delay, reduce, or cancel subsequent phases of its existing and forthcoming LNG terminal projects.

Crown’s ability to obtain bank financing or to access the capital markets for future debt or equity offerings may also be limited by its financial condition, results of operations or other factors, such as its credit rating or outlook at the time of any such financing or offering and the covenants in its existing debt agreements, as well as by general economic conditions and contingencies and uncertainties that are beyond its control. As we seek additional financing, it will be subject to the risks of rising interest rates and other factors affecting the financial markets. Therefore, there can be no assurances that it will be able to obtain additional capital and/or that it will be able to obtain bank financing or access the capital markets on commercially reasonable terms or at all.

We may experience increased labor costs, and the unavailability of skilled workers or our failure to attract and retain qualified personnel could adversely affect our business. In addition, changes in senior management or other key personnel could affect our business results.

We are dependent upon the available labor pool of skilled employees. We compete with other energy companies and other employers to attract and retain qualified personnel with the technical skills and experience required to construct and operate its facilities and pipelines and to provide its customers with the highest quality service. A shortage in the labor pool of skilled workers, remoteness of its site locations or other general inflationary pressures, changes in applicable laws and regulations or labor disputes could make it more difficult for us to attract and retain qualified personnel and could require an increase in the wage and benefits packages that we offer, thereby increasing our operating costs. Any increase in our operating costs could materially and adversely affect our business, contracts, financial condition, operating results, cash flow, liquidity, and prospects. Furthermore, we depend on our executive officers for various activities. The loss of the services of any of these individuals could have a material adverse effect on our business.

 

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Our business is dependent on its partners and Engineering, Procurement, Construction, Installation & Commissioning (“EPCIC”) contractors (which will be led by Aker Solutions with Wärtsilä Gas Solutions and Siemens Energy as sub-contractors) for the successful completion of its LNG terminals and any potential expansion projects.

Timely and cost-effective completion of its LNG terminal projects and any potential expansion projects, in compliance with agreed specifications, is central to our business strategy and is highly dependent on the performance of its EPCIC partners and other contractors, such as Aker Solutions with Wärtsilä Gas Solutions and Siemens Energy. The ability of Crown’s EPCIC partners and other contractors to perform successfully under their agreements is dependent on a number of factors, including their ability to:

 

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design and engineer each terminal to operate in accordance with specifications;

 

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engage and retain third party subcontractors and procure equipment and supplies;

 

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respond to difficulties such as equipment failure, delivery delays, schedule changes and failure to perform by subcontractors, some of which are beyond their control;

 

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attract, develop, and retain skilled personnel, including engineers;

 

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post required construction bonds and comply with the terms thereof;

 

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manage the construction process generally, including coordinating with other contractors and regulatory agencies; and

 

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maintain their own financial condition, including adequate working capital.

Until and unless we have entered into an EPCIC contract for a particular project in which the EPCIC contractor agrees to meet our planned schedule and projected total costs for a project, we are subject to potential fluctuations in construction costs and other related project costs. Although Crown expects to utilize fixed-price, date-certain, turnkey EPCIC contracts with liquidated damages if the contractor fails to perform in the manner required with respect to certain of its obligations, the events that trigger a requirement to pay liquidated damages may delay or impair the operation of the applicable facility, and any liquidated damages that we receive may be delayed or insufficient to cover the damages that we may suffer as a result of any such delay or impairment.

We expect that the obligations of our future EPCIC contractors and our other contractors to pay liquidated damages under their agreements with us will be subject to caps on liability. Furthermore, we may have disagreements with our contractors about different elements of the construction process, which could lead to the assertion of rights and remedies under their contracts and increase the cost of the applicable facility or result in a contractor’s unwillingness to perform further work. We may hire contractors to perform work in jurisdictions where they do not have previous experience, or contractors we have not previously hired to perform work in jurisdictions where we are beginning to develop projects, which may lead to such contractors being unable to perform according to their respective agreements. If any contractor is unable or unwilling to perform according to the negotiated terms and timetable of its respective agreement for any reason or terminates its agreement for any reason, we would be required to engage a substitute contractor, which could be particularly difficult in certain of the markets in which we plan to operate. This would likely result in significant project delays and increased costs, which could have a material adverse effect on our business, contracts, financial condition, operating results, cash flow, liquidity and prospects.

In addition, if our future contractors are unable or unwilling to perform according to their respective agreements with us, our LNG terminals may be delayed and Crown may face contractual consequences in our agreements with our customers. We may be required to pay liquidated damages, face increased expenses or reduced revenue, and may face issues complying with certain covenants in such customer contracts or in our financings. Our contracts may not provide for our contractors to compensate us fully for such payments and other consequences.

 

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Our ability to secure project level debt and equity financing for its initial LNG terminals in India and the U.K. depends on our ability to sign sufficient TUAs with high-credit quality customers. To date, we have not signed any TUAs. If we are unsuccessful in signing sufficient TUAs, then we will be unable to raise the requisite project level funding for the construction of our LNG terminals. This situation could materially and adversely affect our financial condition, cash flow, liquidity, and prospects.

We expect that, in order to achieve FID and secure project level funding, we will need to secure TUAs for at least 4 million tons per annum (“MTPA”) and 3 MTPA for the Kakinada and Grangemouth Projects, respectively. We are currently in TUA discussions with credit-worthy customers in India and the U.K. However, there can be no assurance that we will successfully execute these TUAs in the required amounts or in a reasonable period of time to enable a financial closing and construction to commence on these two initial projects.

[Our management concluded that there is substantial doubt about its ability to continue as a going concern.]

We had net income / (losses) of $(4,174) thousands and $(27,905) thousands for the years ended December 31, 2023 and 2022, respectively. We used net cash in operating activities of $(2,923) and $(611) thousands for the years ended December 31, 2023 and 2022, respectively.

Our management is forecasting that we will continue to incur significant operating cash outflows to fund the Kakinada and Grangemouth Projects, as well as to support its growth, including but not limited to terminal operation expenses, operating insurance costs, land and port charges, general and administrative and other costs.

We will require additional financing to support the operations of its business. The forecast and financial conditions raise substantial doubt about our ability to continue to operate as a going concern. Our ability to operate as a going concern is principally dependent on the (1) successful bridge financing during the period up until the successful completion of the Business Combination and the PIPE financing or additional permitted financing, and (2) our ability to reach the designated FID dates for the projects. As a result of the above, there is material uncertainty related to the events or conditions that may cast substantial doubt of our ability to continue as a going concern, and therefore, that we may be unable to realize its assets and discharge its liabilities in the normal course of business.

Failure to generate sufficient cash flows from operations and raise additional capital could have a material adverse effect on our ability to achieve its intended business objectives.

We are subject to stringent environmental, health and safety laws in numerous jurisdictions around the world and may incur material costs to comply with these laws and regulations.

We incur, and expect to continue to incur, substantial capital and operating expenditures to comply with increasingly complex laws and regulations covering the protection of the natural environment and the protection of worker health and safety, including:

 

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costs to prevent, control, eliminate or reduce certain types of air and water emissions;

 

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remedial measures related to environmental contamination or accidents at various sites, including those by third parties; and

 

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compensation of persons claiming damages caused by our activities or accidents.

If our established financial reserves prove not to be adequate, environmental costs could have a material effect on our results of operations and financial position. Furthermore, in the countries where we operate or expect to operate in the near future, new laws and regulations, the imposition of tougher license requirements, increasingly strict enforcement or new interpretations of existing laws and regulations or the discovery of

 

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previously unknown contamination may also cause us to incur material costs. As a further result of any new laws and regulations or other factors, we may also have to curtail or cease certain operations, which could diminish our productivity and materially and adversely impact our results of operations, including profits.

Our ability to execute the Grangemouth Terminal is contingent on obtaining the necessary permits, approvals, licenses and agreements.

The permits, approvals, licenses and agreements required to execute the Grangemouth Terminal begin on page 89. Permit applications have yet to be submitted. The outcome of those applications, including terms/ conditions which might be imposed, will depend on the design and location of the FSRU, which have not been finalized, and the outcome of environmental surveys. Environmental impact assessment and Habitats Regulation assessments may be required, which would involve comprehensive environmental surveys, increasing the duration of the consenting process. Real estate/ property and other agreements also require to be entered into with various public bodies, commercial organizations and/ or private landowners.

Our business and financial performance relating to the Kakinada and Grangemouth Projects are dependent on various legal rights and options that we have under agreements with KGLNG and GBTron, including the Exclusivity Agreements, the KGLNG Future Payment Right, KGLNG Option, and the GBTron Option. If such rights are impaired, our business and financial performance may be adversely affected.

Our rights to develop the Kakinada terminal derive from its Exclusivity Agreement dated June 3, 2020 and amended on August 3, 2023 with EAST, which holds the license with the MOEF and is the legal party to all permits, approvals and licenses associated with the Kakinada terminal. Under the KGLNG Agreement dated August 3, 2023, we also hold the right to receive an amount equal to all future distributions made by KGLNG to our shareholders until the aggregate amount of such distributions equals $3.266 billion, and an option to purchase all shares of KGLNG at an exercise price of $60 million.

Our rights to develop the Grangemouth terminal derive from its Exclusivity Agreement dated August 27, 2020 and amended on August 3, 2023 with GBTron, which provides us with the exclusive right to develop, build, own and operate a FSRU located near Grangemouth Port in the Firth of Forth and to provide storage and re-gasification services to GBTRON for our planned CCGT project and other potential customers. Under the GBTron Agreement dated August 3, 2023, we also hold an option to purchase all shares of a NewCo which will own certain rights, obligations and assets in connection with development of the Grangemouth Project, at an exercise price of $25 million.

If any of our legal rights under these agreements are adversely affected or terminated for any reason whatsoever, our business and financial performance may be materially impacted. For example, under the terms of the KGLNG Agreement, if first gas for the Kakinada project is not achieved by January 1, 2030 for any reason whatsoever, the KGLNG Future Payment Right can be terminated, which may significantly affect the economic benefits we expect to receive from the Kakinada terminal. If the KLNG Option or the GBTron Option is not exercised or is unable to be exercised for any reason whatsoever, we will not have direct ownership over the permits, approvals, licenses, and rights for the Kakinada and Grangemouth projects, and will continue to rely on our legal rights under the respective Exclusivity Agreements.

Any expansion of our business activities through mergers, acquisition, joint ventures, or strategic alliances may be affected by antitrust laws in one or more jurisdictions, access to capital resources, and the costs and difficulties of integrating future acquired businesses and technologies, which could impede its future growth and adversely affect its competitiveness.

We may seek to achieve its growth objectives by (i) optimizing its offerings to meet the needs of its customers through organic development, (ii) through acquisitions, joint ventures, investments and dispositions, and (iii) through implementing its transformational strategy in connection with the Business Combination. If we

 

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are unable to successfully execute on its strategies to achieve our growth objectives or drive operational efficiencies, or if we experience higher than expected operating costs that cannot be adjusted accordingly, our growth rates and profitability could be adversely affected. Acquisitions have not historically been a significant part of our growth strategy; however, going forward, we expect to evaluate and, where appropriate, opportunistically undertake acquisitions. To the extent we seek to grow our business through acquisitions, we may not be able to successfully identify attractive acquisition opportunities or make acquisitions on terms that are satisfactory to our business from a commercial perspective. In addition, competition for acquisitions in the markets in which we operate during recent years has increased, which may increase costs of acquisitions or cause us to refrain from making certain acquisitions. We may also be subject to increasing regulatory scrutiny from competition and antitrust authorities in connection with acquisitions. Achieving the expected returns and synergies from existing and future acquisitions will depend in part upon its ability to develop and construct the terminals in our liquefaction projects in an efficient and effective manner. There can be no assurances that we will be able to do so, or that our acquired businesses will perform at anticipated levels or that it will be able to obtain these synergies. Management resources may also be diverted from operating its existing business to certain acquisition integration challenges. If we are unable to successfully integrate acquired businesses, our anticipated revenues and profits may be lower. Our profit margins may also be lower, or diluted, following the acquisition of companies whose profit margins are less than those of our existing business.

We may also finance future transactions through debt financing, the issuance of our equity securities, the use of existing cash, cash equivalents or investments, or a combination of the foregoing. Acquisitions financed with debt could require us to dedicate a substantial portion of its cash flows to principal and interest payments and could subject it to restrictive covenants. Future acquisitions financed with its cash could deplete the cash and working capital available to fund its operations adequately. Difficulty borrowing funds, selling securities, or generating sufficient cash from operations to finance its activities may have a material adverse effect on our results of operations.

We may also decide from time to time to dispose of assets that are no longer aligned with our strategic objectives and/or we deem to be non-core. Once a decision to divest has been made, there can be no assurance that a transaction will occur, or if a transaction does occur, there can be no assurance as to the potential value created by the transaction. The process of exploring strategic alternatives or selling a business could negatively impact customer decision-making and cause uncertainty and negatively impact its ability to attract, retain and motivate key employees. In addition, we expend costs and management resources to complete divestitures. Any failures or delays in completing divestitures could have an adverse effect on our financial results and on our ability to execute our strategy.

System failures, defects, errors or vulnerabilities in its website, applications, backend systems or other technology systems or those of third-party technology providers could harm our reputation and adversely affect our business.

If our critical infrastructure in any of our LNG terminals were to fail, or if we were to suffer a technological interruption at any of our LNG terminals, we could lose important engineering and technical data, which could harm our business. Our facilities are vulnerable to damage or interruption from earthquakes, hurricanes, floods, fires, cyber security attacks, terrorist attacks, power losses, telecommunications failures and similar events. In the event that we or any third-party provider’s systems or service abilities are hindered by any of the events discussed above, we would be required to identify and devise, invest in, and implement certain technology, business, and other initiatives, which could temporarily or permanently impair our ability to operate. A decision to close our facilities without adequate notice, or other unanticipated problems, could adversely impact Crown’s business and financial condition. Any of the aforementioned risks may be augmented if our or any third-party provider’s business continuity and/or disaster recovery plans prove to be inadequate. Our facilities also could be subject to break-ins, computer viruses, sabotage, intentional acts of vandalism and other misconduct. Any security breach, including personal data breaches, or incident, including cybersecurity incidents, that our experiences could result in unauthorized access to, misuse of or unauthorized acquisition of our or our

 

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customers’ data, the loss, corruption or alteration of this data, interruptions in our operations or damage to our computer hardware, systems, or those of our customers. Moreover, negative publicity arising from these types of disruptions could damage our reputation. We may not carry sufficient business interruption insurance to compensate for losses that may occur as a result of any events that cause interruptions in our business. If we are unable to maintain the availability of our critical technology systems and data and safeguard the confidentiality and integrity of our data, this could harm our reputation and compromise our ability to conduct our business.

We are subject to economic, political, and other risks of doing business globally and in emerging markets.

We are a multi-national business and our business strategies may involve expanding or developing our business in emerging market regions. Due to the international nature of our business, we are exposed to various risks of international operations, including:

 

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adverse trade policies or trade barriers on natural gas; and government regulations;

 

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inflation and hyperinflation and adverse economic effects resulting from governmental attempts to control inflation, such as the imposition of wage and price controls and higher interest rates;

 

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changes in laws and regulations or its interpretation or enforcement in the countries where we operate, such as tax laws;

 

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difficulties in enforcing agreements or judgments and collecting receivables in foreign jurisdictions;

 

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exchange controls or other currency restrictions and limitations on the movement of funds, such as on the remittance of dividends by subsidiaries;

 

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inadequate infrastructure and logistics challenges;

 

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sovereign risk and the risk of government intervention, including through expropriation, or regulation of the economy or natural resources, including restrictions on foreign ownership of land or other assets; while we may adopt insurance coverage to cover certain risks, this may not be sufficient to cover all of the aforementioned business risks;

 

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the requirement to comply with a wide variety of laws and regulations that apply to international operations, including, without limitation, economic sanctions regulations, labor laws, import and export regulations, anti-corruption and anti-bribery laws;

 

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challenges in maintaining an effective internal control environment with operations in multiple international locations, including language differences, varying levels of accounting expertise in international locations and multiple financial information systems;

 

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changes in a country’s or region’s economic or political condition; and

 

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labor disruptions, civil unrest, significant political instability, coup attempts, wars or other armed conflict or acts of terrorism.

Emerging markets are subject to different risks as compared to more developed markets. Operating a business in an emerging market can involve a greater degree of risk than operating a business in more developed markets, including, in some cases, increased political, economic and legal risks. Emerging market governments and judiciaries often exercise broad, unchecked discretion and are susceptible to abuse and corruption. Moreover, financial turmoil in any emerging market country tends to adversely affect the value of investments in all emerging market countries as investors move their money to more stable, developed markets. As has happened in the past, financial problems or an increase in the perceived risks associated with investing in companies in emerging economies could dampen foreign investment and adversely affect the local economy. Generally, investment in emerging markets is only suitable for sophisticated investors who fully appreciate the significance of the risks involved in, and are familiar with, investing in emerging markets.

 

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Our insurance may be insufficient to cover losses that may occur to our terminals or result from our operations.

Our current operations and future projects are subject to the inherent risks associated with LNG, natural gas and other risks, including explosions, pollution, release of toxic substances, fires, seismic events, hurricanes and other adverse weather conditions, acts of aggression or terrorism and other hazards, each of which could result in significant delays in commencement or interruptions of operations or result in damage to or destruction of our facilities and assets or damage to persons and property. Some of the regions in which we operate are affected by hurricanes or tropical storms. We do not, nor do we intend to, maintain insurance against all of these risks and losses, and the business interruption insurance that we do carry may not be adequate to pay for the full extent of loss from a covered incident. In particular, we do not carry business interruption insurance for hurricanes and other natural disasters. Therefore, the occurrence of one or more significant events not fully insured or indemnified against could create significant liabilities and losses or delays which could have a material adverse effect on our business, contracts, financial condition, operating results, cash flow, liquidity and prospects.

We may be unable to procure adequate insurance coverage at commercially reasonable rates in the future. For example, environmental regulations have led in the past to increased costs for, and in the future may result in the lack of availability of, insurance against risks of environmental damage or pollution. A significant release of natural gas, marine disasters or natural disasters could result in losses that exceed our insurance coverage, which could harm our business, financial condition and operating results. Any uninsured or underinsured loss could harm our business and financial condition. In addition, our insurance may be voidable by the insurers as a result of certain of our actions.

We intend to operate in jurisdictions that have experienced and may in the future experience significant political volatility. Our projects and developments could be negatively impacted by political disruption including risks of delays to our development timelines and delays related to regime change in the jurisdictions in which we intend to operate. We maintain industry-standard war risk insurance, but we do not carry political risk insurance currently. If we choose to carry political risk insurance in the future, it may not be adequate to protect us from loss, which may include losses as a result of project delays or losses as a result of business interruption related to a political disruption. Any attempt to recover from loss from political disruption may be time-consuming and expensive, and the outcome may be uncertain.

Changes in the insurance markets attributable to terrorist attacks or political change may also make certain types of insurance more difficult for us to obtain. In addition, the insurance that may be available may be significantly more expensive than our existing coverage.

Currency fluctuations, inflation, trade barriers, extreme weather, pandemics, war, tariffs, or shortages and other general economic or political conditions could limit our ability to obtain key components, significantly increase our costs, and hinder our operations generally.

Conflict, war or other political disagreements between gas producing nations and potential customers could affect our operations in unpredictable ways, including disruptions of fuel supplies and markets and the possibility that infrastructure facilities, including pipelines, production facilities, refineries, electric generation, transmission and distribution facilities, offshore rigs and vessels and communications infrastructures, could be direct targets of, or indirect casualties of, a cyberattack or an act of piracy or terror. The continued threat of terrorism and the impact of military and other government action has led and may lead to further increased volatility in prices for natural gas and could affect the natural gas market or the financial markets that we use.

The global credit and financial markets have experienced significant volatility and disruptions, including diminished liquidity and credit availability, declines in consumer confidence, inflation, declines in economic growth, wage inflation because of labor shortages and uncertainty about economic stability. The financial markets and the global economy may also be adversely affected by the current or anticipated impact of military conflict, including the conflicts between Russia and Ukraine, Israel and Hamas, terrorism or other geopolitical

 

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events. Sanctions imposed by the United States and other countries in response to such conflicts, including the ones in Ukraine and Israel, may also adversely impact the financial markets and the global economy, and any economic countermeasures by affected countries and others could exacerbate market and economic instability. There can be no assurance that further deterioration in credit and financial markets and confidence in economic conditions will not occur. Our general business strategy may be adversely affected by any such economic downturn, volatile business environment or continued unpredictable and unstable market conditions. If the current equity and credit markets deteriorate, it may make any necessary debt or equity financing more difficult, more costly and more dilutive. These developments, or the perception that any of them could occur, may restrict the ability of key market participants to operate in certain financial markets or restrict our access to capital.

We and our customers operate in a politically sensitive environment, and the public perception of fossil fuel derived energy can affect us and our customers. Our future growth and success are dependent upon consumers’ willingness to develop natural-gas-fueled power generation facilities.

Our future prospects are dependent upon a certain level of public support for natural gas. While the public perception of natural gas is generally more positive than that of oil, coal or gasoline, there is still substantial opposition to natural gas due to its association with hydraulic fracturing (“fracking”), its non-renewability and its reliance on high energy and water inputs. There is a significant coalition of people advocating against the use of natural gas for power generation and instead advocating for nuclear energy or renewable energy sources such as solar and wind energy. Any adverse public reaction to our business, including any high-profile incident involving fracking, could directly affect our customers and could indirectly affect our business. Adverse public reaction could lead to increased regulation or outright prohibition, limitations on the activities of our customers, more onerous operating requirements or other conditions that could have a material adverse impact on our customers’ and on our business.

Outbreaks of infectious diseases, such as the outbreak of COVID-19, at one or more of our facilities could adversely affect its operations.

Our business could be adversely affected by the effects of novel coronavirus (“COVID-19”), monkey pox (mpox), Ebola virus disease, influenza A (“H1N1”), avian flu, severe acute respiratory syndrome (“SARS”), or other epidemic outbreak. In particular, the COVID-19 pandemic began in early 2020 and continued for approximately three years. While we believe it can continue to mitigate any significant adverse impact to our employees and operations at our critical facilities related to the virus in its current form, the risk of future variants is unknown, and the outbreak of a more potent variant or another infectious disease in the future at one or more of our facilities could adversely affect our business operations.

Risks Related to Legal and Regulatory Compliance

Failure to obtain and maintain approvals and permits from governmental and regulatory agencies with respect to the design, construction and operation of our LNG terminals could impede operations and construction and could have a material adverse effect on our business.

The design, construction, and operation of our LNG terminals are highly regulated activities. Certain governmental and regulatory approvals and permits, are required in order to construct and operate an LNG terminal. Authorizations obtained from federal and state regulatory agencies contain ongoing conditions that we must comply with. We intend to maintain full compliance with such conditions; however, failure to comply or our inability to obtain and maintain existing or newly imposed approvals and permits, filings, which may arise due to factors outside of our control such as a government disruption or shutdown, political opposition, or local community resistance to the siting of LNG facilities due to safety, environmental or security concerns, could impede the operation and construction of our infrastructure. In addition, certain of these governmental permits, approvals, and authorizations are or may be subject to rehearing requests, appeals and other challenges. Further, the probability of reaching FID is set based on achieving key milestones, the most critical of which are the approval of technology and achieving access to a fully licensed and approved project. There is no assurance that

 

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we will obtain and maintain these governmental permits, approvals, licenses, and authorizations, or that it will be able to obtain them on a timely basis. Any impediment could have a material adverse effect on our business, contracts, financial condition, operating results, cash flow, liquidity, and prospects.

There is no assurance that we will obtain and maintain the required governmental permits, approvals and authorizations, or that we will be able to obtain them on a timely basis. Any impediment could have a material adverse effect on our business, contracts, financial condition, operating results, cash flow, liquidity and prospects.

Existing and future safety, environmental and similar laws and governmental regulations could result in increased compliance costs or additional operating costs or construction costs and restrictions.

We operate in multiple countries around the world, each with its own regulatory framework and compliance requirements. Accordingly, our business may be subject to extensive national, federal, state, provincial and local laws, rules, and regulations applicable to our construction and operation activities relating to, among other things, air quality, water quality, waste management, natural resources and health and safety. Many of these laws and regulations may restrict or prohibit the types, quantities and concentration of substances that can be released into the environment in connection with the construction and operation of our facilities and require us to maintain permits and provide governmental authorities with access to our facilities for inspection and reports related to our compliance. In addition, certain laws and regulations authorize regulators having jurisdiction over the construction and operation of our LNG terminals, docks, and pipelines to issue regulatory enforcement actions, which may restrict or limit operations or increase compliance or operating costs. Violation of these laws and regulations could lead to substantial liabilities, compliance orders, fines and penalties, difficulty obtaining and maintaining permits from regulatory agencies or to capital expenditures that could have a material adverse effect on our business, contracts, financial condition, operating results, cash flow, liquidity, and prospects. Certain laws and regulations impose liability, without regard to fault or the lawfulness of the original conduct, for the release of certain types or quantities of hazardous substances into the environment. As a result, we could be liable for the costs of cleaning up hazardous substances released into the environment at or from our facilities and for resulting damage to natural resources.

In addition, our business is also subject to complex and comprehensive regulations in India. For example, upon the expiry of operating licenses in India, operators and contractors are generally required under the terms of relevant licenses or local law to dismantle and remove equipment and generally make good production sites. There can be no assurance that we will not in the future incur decommissioning charges, since local or national governments may require decommissioning to be carried out in circumstances where there is no express obligation to do so, particularly in case of future license renewals. The costs, liabilities and requirements associated with complying with existing and future laws and regulations may also be substantial and time-consuming and may delay the commencement or continuation of our LNG terminal activities. This and any changes to the regulations could require changes to the manner in which we conduct our business and result in an increase in compliance costs, which could have a material adverse effect on our business, financial condition and results of operation.

In 2006, the Petroleum and Natural Gas Regulatory Board Act established the Petroleum and Natural Gas Regulatory Board (the “Regulatory Board”). The Regulatory Board strives to protect the interests of consumers and entities engaged in specific activities relating to petroleum, petroleum products and natural gas and to ensure uninterrupted and adequate supply of petroleum, petroleum products and natural gas in all parts of the country and to promote competitive markets. Our facilities are subjected to the Technical Standards and Specifications including Safety Standards for Liquefied Natural Gas Facilities, approved in 2018 by the Regulatory Board. Section 7(2) of the approved text provides any entity intending to set up LNG facilities shall make available its detailed plan conforming to these regulations to Petroleum and Explosives Safety Organization for their approval prior to seeking registration with the Regulatory Board.

 

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Other future legislation and regulations, such as those relating to the transportation and security of LNG imported to or exported from our terminals or climate policies of destination countries in relation to our obligations under our material agreements or other national climate change-related policies, could cause additional expenditures, restrictions and delays in our business and to our proposed construction activities, the extent of which cannot be predicted and which may require Crown to limit substantially, delay or cease operations in some circumstances.

Total expenditures related to environmental and similar laws and governmental regulations, including capital expenditures, were immaterial to our consolidated financial statements for the years ended [December 31, 2022 and 2021]. Revised, reinterpreted or additional laws and regulations that result in increased compliance costs or additional operating or construction costs and restrictions could have a material adverse effect on its business, contracts, financial condition, operating results, cash flow, liquidity, and prospects.

We may be subject to new, stricter measures and/or regulatory requirements for the mitigation or reduction of greenhouse gas emissions that could require radical changes to development models if regulations lump natural gas together with other non-renewable energy sources, and such requirements could adversely affect our business, reputation, and operations.

The increasing focus on the harmful impacts of global climate change and repeated scientific warnings about future risks create new challenges for the energy industry and its regulators. The United Nations and several countries have adopted, or are evaluating the adoption of, new measures and/or regulatory requirements for the mitigation or reduction of greenhouse gas emissions in the atmosphere, such as taxes on carbon, raising efficiency standards or adopting cap and trade regimes. Certain mitigation actions could require radical changes to development models, such as the transition from the use of conventional energy sources to the use of renewable energy sources that reduce environmental pollution, contribute to sustainable development and avoid global warming since the greenhouse gas emissions of renewable energy sources are usually very low. While we believe that electricity produced using natural gas will be an integral part of the global energy transition, certain regulations may lump natural gas together with other non-renewable energy sources such as oil, coal or gasoline rather than renewable energy sources such as wind or solar energy, and, as such, new regulations may be stricter than anticipated. We cannot assure you that new regulations or measures that may be adopted by the U.S. government or foreign governments will not have an adverse effect on our business and our results of operations.

The progress and challenges of the energy transition could have a significant adverse effect on us if we are unable to keep up with the pace of the global energy transition and allocate our resources effectively.

Pipeline safety and compliance programs and repairs may impose significant costs and liabilities on us.

We expect to build and operate a gas pipeline of 19 km between our Kakinada LNG terminal and the onshore landfall point at the Kakinada port. Certain government agencies require pipeline operators to develop management programs to safely operate and maintain pipelines and to comprehensively evaluate certain areas along their pipelines and take additional measures where necessary to protect pipeline segments located in “high or moderate consequence areas” where a leak or rupture could potentially do the most harm. As a pipeline operator, we may be required to:

 

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perform ongoing assessments of pipeline safety and compliance;

 

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identify and characterize applicable threats to pipeline segments that could impact a high consequence area;

 

•

improve data collection, integration, and analysis;

 

•

repair and remediate the pipeline as necessary; and

 

•

implement preventative and mitigating actions.

 

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We may be required to utilize pipeline integrity management programs that are intended to maintain pipeline integrity. Any repair, remediation, preventative, or mitigating actions may require significant capital and operating expenditures. Should we fail to comply with applicable statutes, rules, regulations, and orders, we could be subject to significant penalties and fines.

Additions or changes in tax laws and regulations could potentially affect our financial results or liquidity.

We are subject to various types of tax arising from normal business operations in the jurisdictions in which we operate and transact business. Any changes to local, domestic, or international tax laws and regulations, or their interpretation and application, including those with retroactive effect, could affect our tax obligations, profitability and cash flows in the future. In addition, tax rates in the various jurisdictions in which we operate may change significantly due to political or economic factors beyond its control. We continuously monitor and assess proposed tax legislation that could negatively impact its business. While we seek to optimize our tax treatment wherever we do business, we cannot predict how tax laws will change including the treatment of withholding tax on dividends from our project companies up to us, and then from us to our shareholders.

The Inflation Reduction Act (“IRA”), enacted on August 16, 2022, includes the implementation of a new 15% corporate alternative minimum tax (the “CAMT”) effective in 2023. If we expand our business operations to the United States, it will be subject to the IRA and the CAMT. The CAMT imposition may lead to volatility in our cash tax payment obligations, particularly in periods of significant commodity, currency or financial market variability resulting from potential changes in the fair value of its derivative instruments. CAMT is a novel approach for calculating corporate tax liability. Many unanswered questions remain on how the operative rules for CAMT will be implemented and interpreted in connection with our business, and any additions or changes in applicable tax laws and regulations could potentially affect our financial results or liquidity.

We are exposed to the risk of inadvertently violating anti-corruption, anti-money laundering, anti-terrorist financing and economic sanctions laws and regulations and other similar laws and regulations and any violations of such laws and regulations could adversely affect us by subjecting us to criminal or civil penalties, revocation of our ability to operate in one or more jurisdictions, require significant changes to our business model or otherwise damage our brand and reputation.

Doing business on a worldwide basis requires us to comply with anti-corruption laws and regulations imposed by governments around the world with jurisdiction over our operations, which may include the U.S. Foreign Corrupt Practices Act (“FCPA”), the U.K. Bribery Act 2010 (the “U.K. Bribery Act”) and the Norwegian Penal Code of 2005 (the “NPC”), as well as the laws of the countries where we do business. These laws and regulations may restrict our operations, trade practices, investment decisions, and partnering activities. The FCPA, the U.K. Bribery Act and the NPC prohibit us and our officers, directors, employees, and business partners acting on our behalf, including agents, from corruptly offering, promising, authorizing, or providing anything of value to “foreign officials” for the purposes of influencing official decisions or obtaining or retaining business or otherwise obtaining favorable treatment. The U.K. Bribery Act and the NPC also prohibit non-governmental “commercial” bribery and accepting bribes. As part of our business, we deal with governments and state-owned business enterprises, the employees and representatives of which may be considered “foreign officials” for purposes of the FCPA and the U.K. Bribery Act. We also are subject to the jurisdiction of various governments and regulatory agencies around the world, which may bring our personnel and representatives into contact with “foreign officials” responsible for issuing or renewing permits, licenses or approvals or for enforcing other governmental regulations.

In addition, some of the international locations in which we operate lack a developed legal system and have elevated levels of corruption. Our international operations expose us to the risk of violating, or being accused of violating, anti-corruption laws and regulations. Our failure to successfully comply with these laws and regulations may expose us to reputational harm, as well as significant sanctions, including criminal fines, imprisonment, civil penalties, disgorgement of profits, injunctions and debarment from government contracts, as

 

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well as other remedial measures. Investigations of alleged violations can be expensive and disruptive. We maintain policies and procedures designed to comply with applicable anti-corruption laws and regulations. However, there can be no guarantee that our policies and procedures will effectively prevent violations by our employees or business partners acting on our behalf, including agents, for which we may be held responsible, and any such violation could adversely affect our reputation, business, financial condition, and results of operations.

Unfavorable changes in laws, regulations, and policies in foreign countries in which we seek to develop projects, our, our partners’, or our project developers’ failures to secure timely government authorizations under laws and regulations or our failure to comply with such laws and regulations could have a material adverse effect on our business, financial condition and results of operations.

Compliance with laws and regulations applicable to our international operations increases our cost of doing business in foreign jurisdictions. We may be unable to keep current with changes in foreign government requirements and laws as they change from time to time. Failure to comply with these laws and regulations could have adverse effects on our business. In many foreign countries, it is common for others to engage in business practices that are prohibited by our internal policies and procedures or by U.S. regulations applicable to us. Although we have implemented policies and procedures designed to ensure compliance with these laws and policies, there can be no assurance that all of our employees, contractors, partners and third-party service providers will comply with these laws and policies. Violations of laws or key control policies by our employees, contractors, partners or third-party service providers could result in delays in revenue recognition, financial reporting misstatements, fines, penalties or the prohibition of the importation or exportation of our products and services and could have an adverse effect on our business, financial condition and results of operations.

Risks Related to our Securities

Certain existing shareholders purchased securities in the Company at a price below the current trading price of such securities and may experience a positive investment return based on the current trading price, and may realize significant profits. Future investors in our Company may not experience a similar investment return.

Certain shareholders in the Company, including certain of the Selling Securityholders, acquired Ordinary Shares or Warrants at prices below the current trading price of our Ordinary Shares, and may experience a positive investment return based on the current trading price.

The 1,865,799 warrants that are issuable to the Sponsor included hereby for offer and resale were originally acquired as Catcha’s Class B ordinary shares, par value $0.0001 per share, that were initially issued in a private placement prior to the IPO. Each whole warrant is exercisable for one Ordinary Share at a price of $11.50.

Based on the last reported sale price of our Ordinary Shares on September [ ], 2024 of $[ ] per share, certain Selling Securityholders named in this prospectus could realize significant profits on the sale of their holdings as compared to the initial consideration paid for such holdings.

Given the relatively lower purchase prices that some of our shareholders paid to acquire Ordinary Shares compared to the current trading price of our Ordinary Shares, these shareholders, some of whom are our Selling Securityholders, in some instances will earn a positive rate of return on their investment, which may be a significant positive rate of return, depending on the market price of our Ordinary Shares at the time that such shareholders choose to sell their Ordinary Shares. Investors who purchase our Ordinary Shares in the open market following the Business Combination may not experience a similar rate of return on the securities they purchase due to differences in the purchase prices and the current trading price. Additionally, even though our Ordinary Shares may be trading at a price below the trading price of Galata’s ordinary shares prior to the Business Combination, Sponsor and other affiliates may still be incentivized to sell their shares due to the relatively lower price they paid to acquire such shares.

 

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There can be no assurance that we will be able to comply with the continued listing standards of Nasdaq or any other exchange.

Our Ordinary Shares are currently listed on Nasdaq. We must satisfy the continued listing requirements of Nasdaq to maintain the listing of our Ordinary Shares. On September 3, we received a letter from the Listing Qualifications Department of Nasdaq indicating that we were not in compliance with Nasdaq Listing Rule 5550(a)(2) (the “Rule”) requiring that listed securities maintain a minimum bid price of $1 per share (the “Minimum Bid Price”) based upon the Company’s closing bid price for 30-day trading period of July 22 to August 30, 2024. Additionally, the Notice confirmed that the Rule grants the Company 180 calendar days, or until March 3, 2025, to regain compliance (the “Compliance Period”). Further, the Notice stated that Nasdaq will provide confirmation of compliance and close the matter if the Company’s listed securities maintain the Minimum Bid Price for ten consecutive days at any time during the Compliance Period.

If we are unable to regain compliance with the applicable requirements for continued listing on Nasdaq, our Ordinary Shares may be delisted from Nasdaq. If Nasdaq delists our Ordinary Shares from trading on its exchange for failure to meet the listing standards, us and our shareholders could face significant material adverse consequences including:

 

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a limited availability of market quotations for our securities;

 

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reduced liquidity for our securities;

 

•

a determination that our Ordinary Shares are a “penny stock” which will require brokers trading in our Ordinary Shares to adhere to more stringent rules, possibly resulting in a reduced level of trading activity in the secondary trading market for our Ordinary Shares;

 

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a limited amount of analyst coverage; and

 

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a decreased ability to issue additional securities or obtain additional financing in the future.

If the Business Combination’s benefits do not meet the expectations of investors or securities analysts, the market price of our securities may decline.

If the perceived benefits of the Business Combination do not meet the expectations of investors or securities analysts, the market price of our securities may decline. Fluctuations in the price of our securities could contribute to the loss of all or part of your investment. Any of the factors listed below could have a material adverse effect on your investment in our securities and our securities may trade at prices significantly below the price you paid for them. In such circumstances, the trading price of our securities may not recover and may experience a further decline.

Factors affecting the trading price of our securities may include:

 

•

actual or anticipated fluctuations in our quarterly financial results or the quarterly financial results of companies perceived to be similar to us;

 

•

changes in the market’s expectations about our operating results;

 

•

success of competitors;

 

•

our operating results failing to meet the expectation of securities analysts or investors in a particular period;

 

•

changes in financial estimates and recommendations by securities analysts concerning us or the industry in which we operate;

 

•

operating and share price performance of other companies that investors deem comparable to us;

 

•

changes in laws and regulations affecting our business;

 

•

our ability to meet compliance requirements;

 

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•

commencement of, or involvement in, litigation involving us;

 

•

changes in our capital structure, such as future issuances of securities or the incurrence of additional debt;

 

•

the volume of our Ordinary Shares available for public sale;

 

•

any major change in our Board or management;

 

•

sales of substantial amounts of our Ordinary Shares by our directors, executive officers or significant shareholders or the perception that such sales could occur; and

 

•

general economic and political conditions such as recessions, interest rates, international currency fluctuations and acts of war or terrorism.

Broad market and industry factors may materially harm the market price of our securities irrespective of our operating performance. The stock market in general have experienced price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of the particular companies affected. The trading prices and valuations of these stocks, and of our securities, may not be predictable. A loss of investor confidence in the market for retail stocks or the stocks of other companies which investors perceive to be similar to us could depress our share price regardless of our business, prospects, financial conditions or results of operations. A decline in the market price of our securities also could adversely affect our ability to issue additional securities and our ability to obtain additional financing in the future.

There will be a substantial number of our Ordinary Shares available for sale in the future that may adversely affect the market price of our Ordinary Shares.

Sales of a substantial number of our Ordinary Shares in the public market could occur at any time. These sales, or the perception in the market that the holders of a large number of our Ordinary Shares intend to sell our Ordinary Shares, could reduce the market price of our Ordinary Shares.

As of September 20, 2024, we have an aggregate of 69,298,667 Pubco Ordinary Shares issued. We also have 15,333,333 Pubco Warrants issued, each of which entitles the holder thereof to purchase one Pubco Ordinary Share. As restrictions on resale end and the registration statements are available for use, the market price of our Ordinary Shares could decline.

Our only significant asset is the ownership of Crown, and such ownership may not be sufficient to pay dividends or make distributions or obtain loans to enable us to pay any dividends on our Ordinary Shares, pay its expenses or satisfy other financial obligations.

As a public company, we face increased legal, accounting, administrative and other costs and expenses. The Sarbanes-Oxley Act, including the requirements of Section 404 thereof, as well as rules and regulations subsequently implemented by the SEC, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and the rules and regulations promulgated and to be promulgated thereunder, the Public Company Accounting Oversight Board (“PCAOB”) and the securities exchanges, impose additional reporting and other obligations on public companies. Compliance with public company requirements increased our costs and made certain activities more time-consuming. A number of those requirements require us to carry out activities we did not conduct before as a private company. For example, we adopted new internal controls and disclosure controls and procedures. In addition, expenses associated with SEC reporting requirements are incurred. Furthermore, if any issues in complying with those requirements are identified (for example, if the auditors identify a material weakness or significant deficiency in the internal control over financial reporting), we could incur additional costs rectifying those issues, and the existence of those issues could adversely affect our reputation or investor perceptions of us. It may also be more expensive to obtain director and officer liability insurance. Risks associated with our status as a company publicly-traded in the United States and listed on Nasdaq or as a deemed public company for the purposes of the Jersey Companies Law may make it more difficult to attract and retain

 

37

qualified persons to serve on our Board or as executive officers. The additional reporting and other obligations imposed by these rules and regulations will increase legal and compliance costs and the costs of related legal, accounting and administrative activities. These increased costs will require us to divert a significant amount of money that could otherwise be used to expand the business and achieve strategic objectives. Advocacy efforts by shareholders and third parties may also prompt additional changes in governance and reporting requirements, which could further increase costs.

If we fail to maintain effective internal control over financial reporting, the price of our Ordinary Shares may be adversely affected.

We are required to establish and maintain appropriate internal control over financial reporting. Failure to establish those controls, or any failure of those controls once established, could adversely affect our public disclosures regarding its business, financial condition or results of operations. In addition, management’s assessment of internal control over financial reporting may identify weaknesses and conditions that need to be addressed in our internal control over financial reporting, or other matters that may raise concerns for investors. Any actual or perceived weaknesses and conditions that need to be addressed in our internal control over financial reporting, or disclosure of management’s assessment of our internal control over financial reporting, may have an adverse impact on the price of our Ordinary Shares.

Because we are incorporated in Jersey, Channel Islands, you may face difficulties in protecting your interests, and your ability to protect your rights through the U.S. federal courts may be limited.

We are incorporated under Jersey law. The rights of holders of our Ordinary Shares are governed by Jersey law, including the provisions of the Jersey Companies Law and by the Charter. These rights differ in certain respects from the rights of shareholders in typical U.S. or Cayman corporations.

It may be difficult to enforce a U.S. judgment against us or our directors and officers outside the United States, or to assert U.S. securities law claims outside of the United States.

A number of our directors and executive officers are not residents of the United States, and the majority of our assets and the assets of these persons are located outside the United States. As a result, it may be difficult or impossible for investors to effect service of process upon us within the United States or other jurisdictions, including judgments predicated upon the civil liability provisions of the federal securities laws of the United States. See “Description of Our Securities — Enforcement of Civil Liabilities.” Additionally, it may be difficult to assert U.S. securities law claims in actions originally instituted outside of the United States. Foreign courts may refuse to hear a U.S. securities law claim because foreign courts may not be the most appropriate forum in which to bring such a claim. Even if a foreign court agrees to hear a claim, it may determine that the law of the jurisdiction in which the foreign court resides, and not U.S. law, is applicable to the claim. Further, if U.S. law is found to be applicable, the content of applicable U.S. law must be proved as a fact, which can be a time-consuming and costly process, and certain matters of procedure would still be governed by the law of the jurisdiction in which the foreign court resides.

We are an “emerging growth company,” and we cannot be certain if the reduced SEC reporting requirements applicable to emerging growth companies will make our Ordinary Shares less attractive to investors, which could have a material and adverse effect on us, including our growth prospects.

Upon consummation of the Business Combination, we became an “emerging growth company” as defined in the JOBS Act. We will remain an “emerging growth company” until the earliest to occur of (i) the last day of the fiscal year (a) following the fifth anniversary of the closing of the Business Combination, (b) in which we have total annual gross revenue of at least $1.235 billion or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Ordinary Shares held by non-affiliates exceeds $700 million as of the last business day of our prior second fiscal quarter, and (ii) the date on which we issued more than $1.0 billion in

 

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non-convertible debt during the prior three-year period. We intend to take advantage of exemptions from various reporting requirements that are applicable to most other public companies, whether or not they are classified as “emerging growth companies,” including, but not limited to, an exemption from the provisions of Section 404(b) of the Sarbanes-Oxley Act requiring that our independent registered public accounting firm provide an attestation report on the effectiveness of its internal control over financial reporting and reduced disclosure obligations regarding executive compensation.

Furthermore, even after we no longer qualifies as an “emerging growth company,” as long as we continue to qualify as a foreign private issuer under the Exchange Act, we will be exempt from certain provisions of the Exchange Act that are applicable to U.S. domestic public companies, including, but not limited to, the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act; the sections of the Exchange Act requiring insiders to file public reports of their stock ownership and trading activities and liability for insiders who profit from trades made in a short period of time; and the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q containing unaudited financial and other specified information, or current reports on Form 8-K, upon the occurrence of specified significant events. In addition, we will not be required to file annual reports and financial statements with the SEC as promptly as U.S. domestic companies whose securities are registered under the Exchange Act, and will not be required to comply with Regulation FD, which restricts the selective disclosure of material information.

As a result, our shareholders may not have access to certain information they deem important. We cannot predict if investors will find our Ordinary Shares less attractive because it relies on these exemptions. If some investors find our Ordinary Shares less attractive as a result, there may be a less active trading market and the share price for our Ordinary Shares may be more volatile.

As a “foreign private issuer” under the rules and regulations of the SEC, we are permitted to file less or different information with the SEC than a company incorporated in the United States or otherwise subject to these rules and is permitted to follow certain home-country corporate governance practices in lieu of certain Nasdaq requirements applicable to U.S. issuers.

We are considered a “foreign private issuer” under the Exchange Act and are therefore exempt from certain rules under the Exchange Act, including the proxy rules, which impose certain disclosure and procedural requirements for proxy solicitations for U.S. and other issuers. Moreover, we are not required to file periodic reports and financial statements with the SEC as frequently or within the same time frames as U.S. companies with securities registered under the Exchange Act, although we may elect to file certain periodic reports and financial statements with the SEC on a voluntary basis on the forms used by U.S. domestic issuers. We are not required to comply with Regulation FD, which imposes restrictions on the selective disclosure of material information to shareholders. In addition, our officers, directors and principal shareholders are exempt from the reporting and short-swing profit recovery provisions of Section 16 of the Exchange Act and the rules under the Exchange Act with respect to their purchases and sales of our securities.

We would lose our status as a “foreign private issuer” under current SEC rules and regulations if more than 50% of our outstanding voting securities becomes directly or indirectly held of record by U.S. holders and one of the following is true: (i) the majority of our directors or executive officers are U.S. citizens or residents; (ii) more than 50% of our assets are located in the United States; or (iii) our business is administered principally in the United States. If we lose our status as a foreign private issuer in the future, we will no longer be exempt from the rules described above and, among other things, will be required to file periodic reports and annual and quarterly financial statements as if it were a company incorporated in the United States. If this were to happen, we would likely incur substantial costs in fulfilling these additional regulatory requirements and members of our management would likely have to divert time and resources from other responsibilities to ensuring these additional regulatory requirements are fulfilled.

 

39

Our Ordinary Shares may or may not pay cash dividends in the foreseeable future, and you may not receive any return on investment unless you sell our Ordinary Shares for a price greater than that which you paid for it.

We may retain future earnings, if any, for future operations, expansion and debt repayment and have no current plans to pay any cash dividends for the foreseeable future. Any decision to declare and pay dividends as a public company in the future will be made at the discretion of our Board and will depend on, among other things, our results of operations, financial condition, cash requirements, contractual restrictions and other factors that the Board may deem relevant. In addition, our ability to pay dividends may be limited by covenants of any existing and future outstanding indebtedness we or our subsidiaries incur. As a result, you may not receive any return on an investment unless you sell our Ordinary Shares for a price greater than that which you paid for it.

We may redeem your unexpired public warrants prior to their exercise at a time that is disadvantageous to you, thereby making your public warrants worthless.

We will have the ability to redeem outstanding public warrants at any time after they become exercisable and prior to their expiration, at a price of $0.01 per warrant, provided that the last reported sales price of our Ordinary Shares equals or exceeds $18.00 per share for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date we give notice of redemption. If and when the public warrants become redeemable by us, we may exercise its redemption right even if it is unable to register or qualify the underlying securities for sale under all applicable state securities laws. Redemption of the outstanding public warrants could force you (i) to exercise your public warrants and pay the exercise price therefor at a time when it may be disadvantageous for you to do so, (ii) to sell your public warrants at the then-current market price when you might otherwise wish to hold your public warrants or (iii) to accept the nominal redemption price which, at the time the outstanding public warrants are called for redemption, is likely to be substantially less than the market value of your public warrants. None of the private placement warrants will be redeemable by us so long as they are held by their initial purchasers or their permitted transferees.

Historical trading prices for the public shares have varied between a low of approximately $0.26 per share on September 19, 2024 to a high of approximately $6.9 per share on July 10, 2024 but have not approached the $18.00 per share threshold for redemption (which, as described above, would be required for 20 trading days within a 30 trading-day period after they become exercisable and prior to their expiration, at which point the public warrants would become redeemable). In the event that we elect to redeem all of the redeemable warrants as described above, we will fix a date for the redemption. Notice of redemption will be mailed by first class mail, postage prepaid, by us not less than 30 days prior to the redemption date to the registered holders of the public warrants to be redeemed at their last addresses as they appear on the registration books. Any notice mailed in the manner provided in the Warrant Agreement shall be conclusively presumed to have been duly given whether or not the registered holder received such notice. In addition, beneficial owners of the redeemable warrants will be notified of such redemption by posting of the redemption notice to DTC. We are not contractually obligated to notify investors when its warrants become eligible for redemption and do not intend to so notify investors upon eligibility of the warrants for redemption.

We may issue additional Pubco Ordinary Shares, which would dilute the interest of our shareholders.

We may issue additional Pubco Ordinary Shares or other equity securities of equal or senior rank in the future in connection with, among other things, financings, future acquisitions, repayment of outstanding indebtedness, employee benefit plans and exercises of outstanding options, warrants and other convertible securities, in a number of circumstances.

Our issuance of additional Pubco Ordinary Shares or other equity securities of equal or senior rank would have the following effects:

 

•

Public shareholders’ proportionate ownership interest in Pubco will decrease;

 

40

•

the amount of cash available per share, including for payment of dividends (if any) in the future, may decrease; and

 

•

the market price of Pubco Ordinary Shares may decline.

An active, liquid trading market for Pubco Ordinary Shares and Pubco Warrants may not develop, which may limit your ability to sell Pubco Ordinary Shares and Pubco Warrants.

An active trading market for our securities may never develop or, if developed, it may not be sustained, which would make it difficult for you to sell your Pubco Ordinary Shares or Pubco Warrants at an attractive price or at all.

Reports published by analysts, including projections in those reports that differ from our actual results, could adversely affect the price and trading volume of our Ordinary Shares.

Securities research analysts may establish and publish their own periodic projections for Pubco. These projections may vary widely and may not accurately predict the results we actually achieve. Our share price may decline if our actual results do not match the projections of these securities research analysts. Similarly, if one or more of the analysts who write reports on us downgrades our stock or publishes inaccurate or unfavorable research about our business, our share price could decline. If one or more of these analysts ceases coverage of us or fails to publish reports on us regularly, our share price or trading volume could decline. If no analysts commence coverage of us, the market price and volume for Pubco Ordinary Shares could be adversely affected. If any analyst who may cover Pubco were to cease coverage of Pubco or fail to regularly publish reports on it, Pubco could lose visibility in the financial markets, which in turn could cause its share price or trading volume to decline.

We do not have experience operating as a public company subject to U.S. federal securities laws and may not be able to adequately develop and implement the governance, compliance, risk management and control infrastructure and culture required for a public company, including compliance with the Sarbanes Oxley Act.

We do not have experience operating as a public company subject to U.S. federal securities laws. Our officers and directors lack experience in managing a public company subject to U.S. federal securities laws, which makes their ability to comply with applicable laws, rules and regulations uncertain. Our failure to comply with all applicable laws, rules and regulations could subject us to U.S. regulatory scrutiny or sanction, which could harm our reputation and share price.

We have not previously been required to prepare or file periodic or other reports with the SEC or to comply with the other requirements of U.S. federal securities laws. We have not previously been required to establish and maintain the disclosure controls and procedures, and internal control over financial reporting applicable to an entity that is a foreign private issuer under U.S. federal securities laws, including the Sarbanes-Oxley Act. Pubco may experience errors, mistakes and lapses in processes and controls, resulting in failure to meet requisite U.S. standards.

As a public company subject to U.S. federal securities laws, we will incur significant legal, accounting, insurance, compliance, and other expenses. Compliance with reporting, internal control over financial reporting and corporate governance obligations may require members of our management and our finance and accounting staff to divert time and resources from other responsibilities to ensure these new regulatory requirements are fulfilled.

If it fails to adequately implement the required governance and control framework, we may fail to comply with the applicable rules or requirements associated with being a public company subject to U.S. federal securities laws. Such failure could result in the loss of investor confidence, could harm our reputation, and cause the market price of our Ordinary Shares to decline.

 

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Due to inadequate governance and internal control policies, misstatements or omissions due to error or fraud may occur and may not be detected, which could result in failures to make required filings in a timely manner or result in making filings containing incorrect or misleading information. Any of these outcomes could result in SEC enforcement actions, monetary fines or other penalties, as well as damage to our reputation, business, financial condition, operating results and share price.

We will be a holding company with no business operations of our own and will depend on cash flow from Crown to meet its obligations.

We are a holding company with no business operations of our own or material assets other than the stock of our subsidiaries. All of our operations are conducted by our subsidiary, Crown, and Crown’s subsidiaries. As a holding company, we require dividends and other payments from our subsidiaries to meet cash requirements. The terms of any credit facility may restrict our subsidiaries from paying dividends and otherwise transferring cash or other assets to it. If there is an insolvency, liquidation or other reorganization of any of our subsidiaries, our shareholders may have no right to proceed against their assets. Creditors of those subsidiaries will be entitled to payment in full from the sale or other disposal of the assets of those subsidiaries before us, as an equity holder, would be entitled to receive any distribution from that sale or disposal. If Crown is unable to pay dividends or make other payments to us when needed, we will be unable to satisfy our obligations.

The price of our Ordinary Shares and our Warrants may be volatile.

The price of our Ordinary Shares and our Warrants may fluctuate due to a variety of factors, including:

 

•

changes in the industry in which we and our customers operate;

 

•

variations in our operating performance and the performance of our competitors in general;

 

•

the impact of global health-related outbreaks (including COVID-19) on the markets and the broader global economy;

 

•

actual or anticipated fluctuations in our annual or interim operating results;

 

•

publication of research reports by securities analysts about us or our competitors or our industry;

 

•

the public’s reaction to our press releases, our other public announcements and our filings with the SEC;

 

•

Our failure or the failure of our competitors to meet analysts’ projections or guidance that us or our competitors may give to the market;

 

•

additions and departures of key personnel;

 

•

changes in laws and regulations affecting its business;

 

•

failure to comply with laws or regulations, including the Sarbanes-Oxley Act, or failure to comply with the requirements of the relevant U.S. stock exchange;

 

•

actual, potential or perceived control, accounting or reporting problems;

 

•

commencement of, or involvement in, litigation involving us;

 

•

changes in our capital structure, such as future issuances of securities or the incurrence of additional debt;

 

•

the volume of our capital stock available for public sale;

 

•

general economic and political conditions such as recessions, interest rates, fuel prices, foreign currency fluctuations, international tariffs, sanctions, export controls, social, political and economic risks and epidemics and pandemics (including ongoing COVID-19 outbreaks), acts of war or terrorism; and

 

•

the other factors described in this “Risk Factors” section.

 

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These market and industry factors may materially reduce the market price of our Ordinary Shares and our Warrants regardless of our operating performance.

A significant portion of our total outstanding shares are restricted from immediate resale but may be sold into the market in the near future. This could cause the market price of our Ordinary Shares to drop significantly, even if our business is doing well.

Sales of a substantial number of our Ordinary Shares in the public market could occur at any time. These sales, or the perception in the market that the holders of a large number of shares intend to sell shares, could reduce the market price of our Ordinary Shares. As restrictions on resale end and the registration statements are available for use, the market price of our Ordinary Shares could decline if the holders of currently restricted shares sell them or are perceived by the market as intending to sell them.

There may be less publicly available information concerning us than there is for issuers that are not foreign private issuers because it is anticipated that we will be considered a foreign private issuer and will be exempt from a number of rules under the Exchange Act and will be permitted to file less information with the SEC than issuers that are not foreign private issuers and we, as a foreign private issuer, will be permitted to follow home country practice in lieu of the listing requirements of a U.S. stock exchange, subject to certain exceptions.

A foreign private issuer under the Exchange Act is exempt from certain rules under the Exchange Act, and is not required to file periodic reports and financial statements with the SEC as frequently or as promptly as companies whose securities are registered under the Exchange Act but are not foreign private issuers, or to comply with Regulation FD, which restricts the selective disclosure of material non-public information. It is anticipated that we will be exempt from certain disclosure and procedural requirements applicable to proxy solicitations under Section 14 of the Exchange Act. Our Board and our officers and principal shareholders will be exempt from the reporting and “short-swing” profit recovery provisions of Section 16 of the Exchange Act. We will not be required to file financial statements prepared in accordance with or reconciled to GAAP so long as its financial statements are prepared in accordance with IFRS as issued by the International Accounting Standards Board. We are not required to comply with Regulation FD, which imposes restrictions on the selective disclosure of material information. Accordingly, there may be less publicly available information concerning us than there is for companies whose securities are registered under the Exchange Act but are not foreign private issuers, and such information may not be provided as promptly as it is provided by such companies.

In addition, certain information may be provided by us in accordance with Jersey law, which may differ in substance or timing from such disclosure requirements under the Exchange Act. As a foreign private issuer, we will be subject to less stringent corporate governance requirements under most U.S. stock exchanges’ rules. Subject to certain exceptions, the rules of most U.S. stock exchanges permit a foreign private issuer to follow its home country practice in lieu of the listing requirements of such U.S. stock exchanges including, for example, certain internal controls as well as board, committee and director independence requirements. If we determine to follow Irish corporate governance practices in lieu of such U.S. stock exchange’s corporate governance standards, we will disclose each of such U.S. stock exchange’s rules that we do not intend to follow and describe the Irish practice that Pubco will follow in lieu thereof.

We may lose its foreign private issuer status in the future, which could result in significant additional costs and expenses. This would subject us to GAAP reporting requirements which may be difficult for it to comply with.

As a “foreign private issuer,” we would not be required to comply with all of the periodic disclosure and current reporting requirements of the Exchange Act and related rules and regulations. Under those rules, the determination of foreign private issuer status is made annually on the last business day of an issuer’s most recently completed second fiscal quarter.

 

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In the future, we could lose our foreign private issuer status if a majority of the Pubco Ordinary Shares are held by residents in the U.S. and it fails to meet any one of the additional “business contacts” requirements. Although we intend to follow certain practices that are consistent with U.S. regulatory provisions applicable to U.S. companies, our loss of foreign private issuer status would make such provisions mandatory. The regulatory and compliance costs to us under U.S. securities laws if we are deemed a U.S. domestic issuer may be significantly higher. If we are not a foreign private issuer, we will be required to file periodic reports and prospectuses on U.S. domestic issuer forms with the SEC, which are more detailed and extensive than the forms available to a foreign private issuer. For example, we would become subject to the Regulation FD, aimed at preventing issuers from making selective disclosures of material information. We also may be required to modify certain of our policies to comply with good governance practices associated with U.S. domestic issuers. Such conversion and modifications will involve additional costs. In addition, we may lose our ability to rely upon exemptions from certain corporate governance requirements of the U.S. stock exchange that it will list upon that are available to foreign private issuers. For example, most U.S. stock exchanges’ corporate governance rules require listed companies to have, among other things, a majority of independent board members and independent director oversight of executive compensation, nomination of directors, and corporate governance matters. As a foreign private issuer, we would be permitted to follow home country practice in lieu of the above requirements. As long as we rely on the foreign private issuer exemption to certain of such stock exchanges’ corporate governance standards, a majority of the directors on our Board are not required to be independent directors, its compensation committee is not required to be comprised entirely of independent directors, and it will not be required to have a nominating committee. Also, we would be required to change its basis of accounting from IFRS as issued by the IASB to GAAP, which may be difficult and costly for it to comply with. If we lose our foreign private issuer status and fail to comply with U.S. securities laws applicable to U.S. domestic issuers, we may have to de-list from such stock exchange and could be subject to investigation by the SEC, such stock exchange and other regulators, among other materially adverse consequences.

 

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CAPITALIZATION AND INDEBTEDNESS

The following table sets forth our total capitalization as of December 31, 2023 on:

 

•

A historical basis for Crown; and

 

•

On an unaudited pro forma condensed combined basis after giving effect to the Business Combination and the PIPE Subscription Agreements.

The information in this table should be read in conjunction with the financial statements and notes thereto and other financial information included in this prospectus or any prospectus supplement. Our historical results do not necessarily indicate our expected results for any future periods.

 

		As of December 31, 2023
		Actual				Pro Forma
(in thousands)
Cash and cash equivalents		$	88			$	5,607
(Deficit) Equity:
Share capital			190				7
Share premium			231,891				322,553
Other capital reserves			12,341				12,341
Cumulative Translation Differences			1,684				1,684
Non-controlling interests			(88	)			(88	)
Accumulated deficit			(23,415	)			(118,135	)
Total (deficit) equity:			222,603				218,362
Total liabilities			24,421				34,891
Total capitalization		$	247,024			$	253,253

 

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UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

Defined terms included below have the same meaning as terms defined and included elsewhere in this prospectus.

Introduction

The following unaudited pro forma condensed combined statement of financial position as of December 31, 2023 combines the historical audited balance sheet of Catcha as of December 31, 2023 and the historical audited consolidated statement of financial position of Crown as of December 31, 2023, giving pro forma effect to the Business Combination, financing agreements and certain other related events, collectively referred to as the “Transactions” for purpose of this section, as if the Transactions had occurred on December 31, 2023.

The following unaudited pro forma condensed combined statement of profit or loss for the year ended December 31, 2023 combines the historical audited statement of operations of Catcha for the year ended December 31, 2023 and the historical audited consolidated statement of comprehensive loss of Crown for the year ended December 31, 2023, giving pro forma effect to the Transactions as if the Transactions had occurred on January 1, 2023, the beginning of the period presented.

The unaudited pro forma condensed combined financial information has been derived from and should be read in conjunction with Crown’s and Catcha’s financial statements and related notes, as applicable. The historical audited financial statements of Catcha as of and for the year ended December 31, 2023 are included in Catcha’s Annual Report on Form 10-K filed with the SEC on June 17, 2024 incorporated herein by reference. The historical audited consolidated financial statements of Crown as of and for the year ended December 31, 2023 are included as Exhibit 15.7 to this report.

Description of the Transactions

On July 9, 2024, the Business Combination was closed, pursuant to the Business Combination Agreement dated August 3, 2023. The closing of the Business Combination resulted in the following transactions:

The Merger

At the Closing of the Business Combination, (i) all the assets and liabilities of Catcha and Merger Sub vested in and became the assets and liabilities of Catcha as the surviving company, and Catcha thereafter existed as a wholly-owned subsidiary of Pubco, and (ii) each issued and outstanding security of Catcha immediately prior to the Closing were cancelled in exchange for or converted into securities of Pubco as set out below.

 

•

Each (a) Catcha Class A Ordinary Share issued and outstanding immediately prior to the Closing was converted into the right to receive one newly issued Pubco Ordinary Share, and (b) remaining Catcha Class B Ordinary Share issued and outstanding prior to the Closing (after the conversion of 7,350,350 Class B Ordinary Shares into an equal number if Class A Ordinary Shares by the Sponsor on May 13, 2024) was converted into the right to receive one newly issued Pubco Ordinary Share;

 

•

Each Catcha warrant outstanding and unexercised immediately prior to the Closing was assumed by Pubco and converted into one Pubco Warrant that entitles the holder thereof to purchase one Pubco Ordinary Share in lieu of one Catcha Class A Ordinary Share and otherwise upon substantially the same terms and conditions applicable to such Catcha warrant prior to the Closing; and

 

•

The single Merger Sub Ordinary Share outstanding immediately prior to the Effective Time was converted into a single ordinary share in Catcha, as the surviving company (such ordinary share being the only outstanding share in Catcha immediately following the Closing).

 

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The Exchange

 

•

On July 9, 2024, subject to the terms and procedures set forth in the Business Combination Agreement, the Crown Shareholders transferred their shares of Common Stock to Pubco. In consideration for such transfer, Pubco issued to each of the Crown Shareholders its Pro Rata Share of the Exchange Consideration. The “Exchange Consideration” is a number of newly issued Pubco Ordinary Shares equal to (a) a transaction value of $600 million divided by (b) a per share price of $10.00. “Pro Rata Share” means, with respect to each Crown Shareholder, a fraction expressed as a percentage equal to (i) the number of shares of Common Stock held by such Crown Shareholder immediately prior to the Closing, divided by (ii) the total number of issued and outstanding shares of Common Stock immediately prior to the Closing.

Accounting for the Business Combination

The Business Combination will be accounted for as a capital reorganization in accordance with IFRS. Under this method of accounting, Catcha was treated as the “acquired” company for financial reporting purposes, and Crown was the accounting “acquirer.” This determination was primarily based on that Crown Shareholders held the majority of the voting power of Pubco, Crown’s operations substantially comprise the ongoing operations of Pubco, Crown’s designees comprise a majority of the governing body of Pubco, and Crown’s senior management comprises the senior management of Pubco. However, Catcha does not meet the definition of a “business” pursuant to IFRS 3 Business Combinations, and thus, for accounting purposes, the Business Combination was accounted for as a capital reorganization. The net assets of Catcha were stated at historical cost, with no goodwill or other intangible assets recorded. The deemed cost of the shares issued by Crown, which represents the fair value of the shares that Crown would have had to issue for the ratio of ownership interest in Pubco to be the same as if the Business Combination had taken the legal form of Crown acquiring shares of Catcha, in excess of the net assets of Catcha was accounted for as share-based compensation under IFRS 2 Share-Based Payment.

Financing Agreements and Other Related Events

April 2024 Notes

On April 30, 2024, Pubco entered into subscription agreements with certain investors with respect to convertible promissory notes issuable upon closing of the Business Combination (the “April 2024 Notes”) with an aggregate original principal amount of $1.05 million for an aggregate purchase price of $1.0 million, reflecting a 5% original issue discount.

The April 2024 Notes bear interest at an annual rate of 10% and mature on the first anniversary of the issuance of the applicable note (the date of such issuance, the “Issuance Date”). Interest on the April 2024 Notes is payable in cash or in-kind through the issuance of additional April 2024 Notes, at the option of Pubco.

The April 2024 Notes are convertible into Pubco Ordinary Shares at the option of the holder. The number of ordinary shares issuable upon conversion of the April 2024 Notes is determined by dividing (x) such Conversion Amount by (y) the Conversion Price (the “Conversion Rate”). “Conversion Amount” means the sum of (A) the portion of the principal of a note to be converted, redeemed or otherwise with respect to which this determination is being made, (B) accrued and unpaid interest with respect to such principal of the applicable note, and (C) any other unpaid amounts, if any. “Conversion Price” means $10.00 initially at the date of issuance of the April 2024 Notes. The Conversion Price will reset to 95% of the lowest closing volume weighted average price observed over the 5 trading days immediately preceding the 270th calendar day following the Issuance Date, subject to a minimum price of $2.50 (the “Minimum Price”).

Pubco has the option to redeem the April 2024 Notes in full at any time after the Issuance Date and prior to maturity thereof upon 10 Trading Days’ (as defined in the April 2024 Notes) notice for cash at a redemption price equal to 110% of the aggregate principal amount thereof, plus accrued and unpaid interest thereon.

 

47

On June 13, 2024, Pubco and those certain investors to the April 2024 Notes entered into separate Note Subscription Agreement Updates to extend the date by which the subscription agreements with respect to the April 2024 Notes will terminate to July 28, 2024 if the closing of the sale of the notes has not occurred by such date.

PIPE

On May 6, 2024, Pubco and Catcha entered into a subscription agreement (the “PIPE Subscription Agreement”) for a private placement (the “PIPE”) with certain accredited investors (the “Purchaser”). Pursuant to the PIPE Subscription Agreement, at consummation of the Business Combination, the Purchaser purchased an aggregate of 176,470 Pubco Ordinary Shares, at a price per share of $8.50, representing aggregate gross proceeds of $1.5 million.

On May 14, 2024, Pubco and Catcha entered into additional subscription agreements (together with the PIPE Subscription Agreement above, the “PIPE Subscription Agreements”) for a private placements with certain accredited investor who are existing shareholders of Crown (the “Existing Shareholder Purchasers”). Pursuant to the PIPE Subscription Agreement, at consummation of the Business Combination, the Existing Shareholder Purchasers purchased an aggregate of 26,393 Pubco Ordinary Shares (together with the Pubco Ordinary Shares to be purchased by the Purchaser, the “PIPE Shares”), at a price per share of $10.00, representing aggregate gross proceeds of $263.9 thousand.

The PIPE Subscription Agreements contain customary representations and warranties of Catcha, Pubco, the Purchaser, and the Existing Shareholder Purchasers, and customary conditions to closing, as well as customary indemnification obligations. Pursuant to the PIPE Subscription Agreements, Pubco has agreed to register the resale of the PIPE Shares and is required to prepare and file a registration statement with the U.S. Securities and Exchange Commission no later than thirty days following the closing date of the Business Combination.

The closing of the PIPE Subscription Agreements took place concurrently with the closing of the Business Combination.

Securities Purchase Agreement

On June 4, 2024, Pubco entered into a definitive securities purchase agreement (the “Securities Purchase Agreement”) with Helena Special Opportunities LLC (the “Investor”), an affiliate of Helena Partners Inc., a Cayman-Islands based advisor and investor, providing for up to approximately USD$20.7 million in funding through a private placement for the issuance of convertible notes (the “SPA Notes”). Capitalized terms used but not defined in the description below shall have the meanings ascribed thereto in the Securities Purchase Agreement

Pursuant to the Securities Purchase Agreement, the Company will issue the SPA Notes and warrants (the “Warrants”) to the Investor across multiple tranches (the “Tranches”) consisting of an initial tranche (the “Initial Tranche”) of (i) an aggregate principal amount of $2.95 million and including an original issue discount (“OID”) of up to an aggregate of $442,500, plus Warrants to purchase a number of Pubco Ordinary Shares equal to the applicable Warrant Share Amounts (defined as 50% of the principal amount of each issued Tranche, divided by $10). The second tranche (the “Second Tranche”) consists of an aggregate principal amount of SPA Notes of up to $2.95 million and including an OID of up to $442,500 and Warrants to purchase a number of Pubco Ordinary Shares equal to the applicable Warrant Share Amounts with respect to such Tranche. The Securities Purchase Agreement contemplates up to five subsequent Tranches, each of which will be in an aggregate principal amount of SPA Notes of $2.95 million each and each including an OID of $442,500 and Warrants to purchase a number of Pubco Ordinary Shares equal to the applicable Warrant Share Amounts with respect to such Tranches. The purchase price of an SPA Note and its accompanying Warrant will be computed by subtracting the portion of the OID represented by such SPA Note from the portion of the principal amount represented by such SPA Note (a “Purchase Price”).

 

48

The Closing of the purchase of each Tranche shall be subject to certain terms and conditions, including but not limited to:

 

a)

Initial Tranche. Closing of the Initial Tranche was occurred on the Closing of the Business Combination

 

b)

The Second Tranche. Closing of the Second Tranche shall not occur prior to the date that is the earlier of (i) the date that is 90 days following the Closing Date of the Initial Tranche and (ii) such date as the Notes and Warrants issuable in such Tranche may be resold pursuant to an effective registration statement pursuant to Rule 144 under the 1933 Act.

 

c)

Third and Fourth Tranches.

a. Closing of each such Tranche shall be for only one Tranche of Notes having an initial aggregate Principal Amount equal to the greater of (i) $50,000 and (ii) the lesser of (x) two and one half times the median of the value of shares traded over each of the thirty (30) Trading Days preceding the Closing Day for such Tranche, and (y) $2.95 million, and

b. the Closing Date of such Tranche shall not occur prior to the date that is the earlier of (i) the date that is 90 days following the Closing Date of the previous Tranche and (ii) such date as the Company and the Investor shall mutually agree.

 

d)

Fifth, Sixth and Seventh Tranches. Closing of any subsequent Tranche shall occur on such date as the Company and the Investor shall mutually agree, if at all; provided that the Closing of any subsequent Tranche shall be for only one Tranche of Notes having an initial aggregate Principal Amount equal to the greater of (i) $50,000 and (ii) the lesser of (x) two and one half times the median of the value of shares traded over each of the 30 Trading Days preceding the Closing Date for such Tranche, and (y) $2.95 million.

Cohen & Company Capital Markets, a division of J.V.B Financial Group, LLC. acted as placement agent to Pubco for the facility described above.

Vendors Promissory Notes for Fee Deferrals

From June 18, 2024 to June 26, 2024, Pubco issued five convertible promissory notes to the vendors Ernst & Young Advokatfirma AS, Wikborg Rein Advokatfirma AS, Ernst & Young AS, Ogier (Jersey) LLP, and Nelson Mullins Riley Scarborough LLP (each a “Vendor,” and collectively, the “Vendors”), agreeing to defer payment for services provided (the “Convertible Vendor Notes”). The aggregate principal amount for all the Convertible Vendor Notes is approximately $5.0 million, bearing interest at 12% per annum. The Convertible Vendor Notes provides that twenty to fifty percent of the principal amount is payable within 30 days after the Closing Date, depending on Vendor. The remaining unpaid principal amount for each Convertible Vendor Note shall be increased by 20%, and payable in equal installments each quarter ending date subsequent to the Closing Date, from between one year and up to five years, depending on Vendor. If Pubco raises additional capital after Close, Pubco will use best endeavors to pay any outstanding principal under the Convertible Vendor Notes.

All the Convertible Vendor Notes provides that upon occurrence of a default, at the option of the Vendor any amounts outstanding under the Convertible Vendor Note may be converted into ordinary shares of at a conversion price equal to the VWAP Price: (i) on the date that is one hundred fifty (150) days following the Closing Date (the “Initial Election Date”), up to an amount equal to fifty percent (50%) of the then outstanding principal amount of this Note; and (ii) on each thirty (30) day anniversary following the Initial Election Date (each such anniversary together with the Initial Election Date, each, an “Election Date”) up to an additional ten percent (10%) of the then outstanding principal amount of the Convertible Vendor Note (collectively, the “Conversion Rights”); provided that (i) the foregoing calculation of the aggregate amount available to be converted into Shares pursuant to the Conversion Rights assumes that there has been no prior payment of the principal of the Convertible Vendor Note and (ii) any amounts that were otherwise available to be converted

 

49

pursuant to the Conversion Rights on an Election Date that were not so converted shall remain available for conversion pursuant to the Conversion Rights on subsequent Election Dates until so converted. A default is constituted in the event of (i) failure by Pubco to pay any portions of the principal amount within five (5) business days after the dates specified in the Convertible Vendor Notes or issue shares pursuant to the Vendor Notes, if so, elected by the Vendor; (ii) voluntary bankruptcy; and (iii) involuntary bankruptcy.

In addition, on July 9, 2024, Pubco also issued promissory notes (the “Promissory Notes”) in an aggregate principal amount of $3.5 million to another Service Provider to Crown and Catcha, with such amounts representing deferrals of fees owed thereto. Such Promissory Notes bear interest at a rate of 12% per annum, payable quarterly, subject to Crown’s option to defer 50% thereof as paid-in-kind, with principal due thereunder payable at maturity on the 18-month anniversary of the issuance thereof. There is no conversion feature provided for under such Promissory Notes.

CCM Amendment Agreement

On June 25, 2024, Cohen & Company Capital Markets division (“CCM”), Catcha and Pubco entered into an Amendment (“CCM Amendment”) to the Engagement Letter, which was originally entered into between CCM and Catcha on May 18, 2023. Nothing was recorded by Catcha yet on its historical audited financials statements for the year ended December 31, 2023 under the original Engagement Letter. Pursuant to the CCM Amendment, the fees contemplated in the Engagement Letter were amended as follows:

 

•

$100,000 paid in full in U.S. dollars simultaneously with the closing of the Business Combination;

 

•

$100,000 paid in full in U.S. dollars simultaneously with the funding of the second tranche of funding pursuant to the Securities Purchase Agreement with Helena Special Opportunities LLC described above;

 

•

350,000 ordinary shares of Pubco, which was satisfied by Sponsor on behalf of Pubco within the aggregate of 1,900,000 of such transfers to Service Providers described above; and

 

•

Issuance by Pubco to CCM at the closing of the Business Combination of a Promissory Note in the principal amount of $1,000,000, which shall be convertible at CCM’s election beginning six months following closing of the Business Combination. The conversion price shall equal the lessor of (x) the 5 VWAP trading days ending on the VWAP trading day immediately preceding the applicable conversion and (y) 95% of the previous trading day closing price of Pubco Ordinary Shares. Upon the second anniversary of issuance, all remaining amounts due under the note shall convert into Pubco Ordinary Shares.

Polar Convertible Promissory Notes

On July 8, 2024, Pubco, Catcha, Sponsor and Polar Multi-Strategy Master Fund (“Polar”) entered into an Amendment (the “March Amendment”) to the March 2023 Subscription Agreement, which was originally entered into between Catcha, Sponsor and Polar, pursuant to which Polar provided $300,000 to Catcha (the “March Capital Contribution”) for working capital purposes.

Pursuant to this Amendment, Pubco, Catcha and the Sponsor jointly and severally, agreed to promptly repay, as a return of capital, an amount equal to the March Capital Contribution funded by Polar to Catcha within five (5) business days of the Closing of the Business Combination, by:

 

A.

Issuance of a convertible promissory note by the Company in favor of Polar or its nominee, with consideration for such note equal to 50% of the March Capital Contribution; and

 

B.

Payment in cash in U.S. Dollars equal to 50% of the March Capital Contribution.

 

50

On July 8, 2024, Pubco, Catcha, Sponsor and Polar entered into an Amendment (the “October Amendment”) to the October 2023 Subscription Agreement, which was originally entered into between Catcha, Sponsor and Polar, pursuant to which Polar provided $750,000 to Catcha (the “October Capital Contribution”) for working capital purposes.

Pursuant to this Amendment, Pubco, Catcha and the Sponsor jointly and severally, agreed to promptly repay, as a return of capital, an amount equal to the October Capital Contribution funded by Polar to Catcha within five (5) business days of the Closing of the Business Combination, by:

 

A.

Issuance of a convertible promissory note by the Company in favor of Polar or its nominee, with consideration for such note equal to 50% of the October Capital Contribution; and

 

B.

Payment in cash in U.S. Dollars equal to 50% of the October Capital Contribution.

On July 8, 2024, Pubco and Polar entered into a Securities Purchase Agreement, pursuant to which Pubco shall issue Promissory Notes for an aggregate purchase price of up to $525,000, divided into two separate notes, with an aggregate principal amount of $583,334, reflecting original issue discount of 10%. The issuance of such Promissory Notes was in satisfaction of 50% of the payment due upon the Closing of the Business Combination under the March Amendment and the October Amendment, as described above, with no additional amount paid by Polar.

Founder Share Transfers

On July 8, 2024, Sponsor transferred an aggregate of 6,511,627 Catcha Class A Ordinary Shares to third parties who provided financing in connection with the Business Combination, Transaction Expense Reduction as well as settlement of liabilities, including on behalf of Crown. This includes 1,500,000 Catcha Class A Ordinary Shares as commitment shares to the Investor in consideration for its entry into the Securities Purchase Agreement described above, 1,900,000 Catcha Class A Ordinary Shares to Service Providers to Catcha in partial consideration for the Transaction Expense Reduction, including fee deferrals, and 3,111,627 Catcha Class A Ordinary Shares to certain investors in consideration for providing financing to Crown and Catcha, including providing the Transferred Collateral securing the Securities Lending Agreement described above, and settlement of certain liabilities. The Catcha Class A Ordinary Shares were exchanged for Pubco Ordinary Shares in the Business Combination, in a transaction registered under the Securities Act of 1933, as amended pursuant to Pubco’s Registration Statement on Form F-4 declared effective by the Securities and Exchange Commission on February 14, 2024 (File No. 333-274832) and, accordingly, may be freely transferred without restrictions under the Securities Act by the recipients thereof. The agreements with certain of the Service Providers provide that, if the Service Provider sells the Service Provider Shares for proceeds equal to or greater than an agreed upon amount, then such Service Provider shall return any remaining Service Provider Shares to Sponsor.

Non-Redemption Agreements

On June 20, 2024, Catcha entered into non-redemption agreements (the “Non-Redemption Agreements”) with two investors (each, a “Backstop Investor”), each acting on behalf of certain funds, investors, entities or accounts that are managed, sponsored or advised by each such Backstop Investor or its affiliates. Pursuant to the Non- Redemption Agreements, the Backstop Investors agreed that, on or prior to closing of the Business Combination, the Backstop Investors will rescind or reverse their previous election to redeem an aggregate of up to approximately 800,000 Catcha ordinary shares (the “Backstop Shares”), which redemption requests were made in connection with Catcha’s extraordinary general meeting of shareholders held on June 12, 2024. Upon consummation of the Business Combination, Catcha paid or caused to be paid to each Backstop Investor a payment in respect of its respective Backstop Shares in cash released from Catcha’s trust account in an amount equal to the product of (x) the number of Backstop Shares and (y) $2.075, which is equal to (A) the price per share for a pro rata portion of the amount on deposit in the trust account, less (B) $9.50. The Non-Redemption Agreement is contingent on the amount of shares the Backstop investors agreed not to redeem. As of June 30, 2024, the number of shares the investor agreed not to redeem was 1,908 shares, pursuant to which $3,950 would be payable to the Backstop Investors. The final amount was determined on July 8, 2024, pursuant to which, Catcha paid $11,717 to the Backstop Investors for agreeing not to redeem 5,486 Backstop Shares at the Closing of the Transactions.

 

51

Basis of Pro Forma Presentation

The following unaudited pro forma condensed combined financial information has been prepared in accordance with Article 11 of Regulation S-X as amended by the final rule, Release No. 33-10786 “Amendments to Financial Disclosures about Acquired and Disposed Businesses” and is for informational purposes only.

The following table sets out the share ownership of Pubco following the Closing⁽¹⁾:

 

		Ownership in Shares				%
Crown Shareholders			60,000,000				87.0	%
Catcha Public Shareholders(2)			226,521				0.3	%
Catcha Sponsor and Founders			838,723				1.2	%
Polar			1,050,000				1.5	%
SPA Notes Investor			1,500,000				2.2	%
Service Providers			1,900,000				2.8	%
PIPE Investors			202,863				0.3	%
Others(3)			3,261,277				4.7	%
Total			68,979,384				100.0	%

 

(1)	Does not give effect to the issuance of any shares issuable upon the exercise or conversion of warrants (including any private placement warrants that may be issued to the Sponsor upon its election upon conversion of the Working Capital Loan and the Extension Note or the SPA warrants).

(2)	Reflects the redemption of 641,303 Class A Ordinary Shares in February 2024, the redemption of 208,674 Class A Ordinary Shares in May 2024, and the redemption of 1,138,361 Class A Ordinary Shares in July 2024.

(3)	It includes Class A Ordinary Shares distributed to certain investors in consideration for providing financing to Crown and Catcha and to meet the roundlot requirements.

Unaudited Pro Forma Condensed Combined Statement of Financial Position

DECEMBER 31, 2023

(In thousands)

 

		Crown (IFRS, Historical)				Catcha (US GAAP, Historical)				IFRS conversion and presentation alignment (Note 2)				Transaction Accounting Adjustments								Pro Forma Combined
ASSETS
Non-current assets
Non-current financial assets		$	242,360			$	—			$	—			$	—							$	242,360
Cash and marketable securities held in Trust Account			—				24,782				—				(22,891	)			A				—
															(2,636	)			B
															446				I
															299				K
Total non-current assets			242,360				24,782				—				(24,782	)							242,360
Current assets
Cash and cash equivalents			88				31				—				2,636				B				5,607
															(2,166	)			C
															541				L
															(525	)			N
															1,000				P

 

52

		Crown (IFRS, Historical)				Catcha (US GAAP, Historical)				IFRS conversion and presentation alignment (Note 2)				Transaction Accounting Adjustments								Pro Forma Combined
															2,250				Q
															1,764				R
															(12	)			S
Current financial assets			4,228				—				—				—								4,228
Note receivable, net of original issuance discount			—				750				—				(750	)			O				—
Derivative asset – Note Receivable, at fair value			—				2,689				—				(2,689	)			O				—
Other current assets			418				10				—				630				C				1,058
Total current assets			4,734				3,480				—				2,679								10,893
Total assets		$	247,094			$	28,262			$	—			$	(22,103	)						$	253,253
EQUITY (DEFICIT) AND LIABILITIES
Equity
Crown share capital		$	190			$	—			$	—			$	(190	)			D			$	—
Pubco ordinary shares			—				—				—				6				D				7
															—				F
															1				H
															—				N
															—				R
Catcha Class A ordinary shares			—				—				—				—								—

Unaudited Pro Forma Condensed Combined Statement of Financial Position — (Continued)

December 31, 2023

(In thousands)

 

		Crown (IFRS, Historical)				Catch (US GAAP, Historical)				IFRS conversion and presentation alignment (Note 2)				Transaction Accounting Adjustments						Pro Forma Combined
Catcha Class B ordinary shares			—				1				—				(1	)		H			—
Share premium			231,891				—				—				(545	)		C			322,553
															184			D
															(14,330	)		E
															2,636			F
															80,924			G
															3,500			J
															112			K
															196			L
															1,630			M
															14,591			Q
															1,764			R
Other capital reserves			12,341				—				—				—						12,341
Accumulated deficit			(23,415	)			(9,969	)			—				(2,259	)		C			(118,135	)
															14,330			E
															(80,924	)		G
															—			I

 

53

		Crown (IFRS, Historical)				Catch (US GAAP, Historical)				IFRS conversion and presentation alignment (Note 2)				Transaction Accounting Adjustments								Pro Forma Combined
															(4,579	)			J
															(299	)			K
															1,900				N
															204				O
															(13,112	)			Q
															(12	)			S
Cumulative translation differences			1,684				—				—				—								1,684
Non-controlling interest			(88	)			—				—				—								(88	)
Total equity (deficit)			222,603				(9,968	)			—				5,727								218,362
Non-current liabilities
Non-current interest-bearing liabilities			1,223				—				—				—								1,223
Non-current lease liabilities			32				—				—				—								32
Provisions			4,758				—				—				—								4,758
Warrant liability			—				622				—				70				M				692
Total non-current liabilities			6,013				622				—				70								6,705
Current liabilities
Current interest-bearing liabilities			2,166				—				—				(954	)			O				1,212
Current lease liabilities			13				—				—				—								13
Trade payables			5,038				—				5,778				(7,955	)			C				2,861
Provisions			10,511				—				—				—								10,511
Other current liabilities			750				—				—				—								750
Class A ordinary shares subject to possible redemption			—				—				24,782				(22,891	)			A				—
															(2,636	)			F
															446				I
															299				K
Capital contribution note, at fair value			—				2,200				—				(2,200	)			N				—
Working capital loan, at fair value			—				676				—				345				L				—
															(1,021	)			M
Note payable, net of original issuance discount			—				750				—				(750	)			N				—
Derivative Liability—Note Payable, at fair value			—				2,689				—				(2,689	)			O				—
Promissory note – related party, at fair value			—				492				—				187				K				—
															(679	)			M
April 2024 Notes			—				—				—				1,000				P				1,000
SPA Notes			—				—				—				—				Q				—
SPA Notes—derivative liability			—				—				—				771				Q				771
Polar convertible promissory notes			—				—				—				372				N				372
Polar convertible promissory notes – derivative liability			—				—				—				153				N				153
CCM convertible promissory notes			—				—				—				—				J				—
CCM convertible promissory notes – derivative liability			—				—				—				1,079				J				1,079
Vendor promissory notes			—				—				—				3,500				C				3,500

 

54

		Crown (IFRS, Historical)				Catch (US GAAP, Historical)				IFRS conversion and presentation alignment (Note 2)				Transaction Accounting Adjustments						Pro Forma Combined
Vendor promissory notes – derivative liability			—				—				—				5,723			C			5,723
Due to related party			—				241				—				—						241
Accounts payable and accrued expenses			—				5,778				(5,778	)			—						—
Total current liabilities			18,478				12,826				24,782				(27,900	)					28,186
Total liabilities			24,491				13,448				24,782				(27,830	)					34,891
Commitments and Contingencies
Class A ordinary shares subject to possible redemption			—				24,782				(24,782	)			—						—
Total equity (deficit) and liabilities		$	247,094			$	28,262			$	—			$	(22,103	)				$	253,253

See accompanying notes to the unaudited pro forma condensed combined financial information.

Unaudited Pro Forma Condensed Combined Statement of Profit or Loss

For the Year ended December 31, 2023

(In thousands, except per share data)

 

		Crown (IFRS, Historical)				Catcha (US GAAP, Historical)				IFRS Conversion and presentation alignment (Note 2)				Transaction Accounting Adjustments								Pro Forma Combined
Revenue		$	—			$	—			$	—			$	—							$	—
Employee benefit expenses			(1,780	)			—				—				—								(1,780	)
Transaction listing cost			—				—				—				(80,924	)			BB				(100,886	)
			—				—				—				(19,962	)			DD				—
Other operating expenses			(9,806	)			—				(6,742	)			(105	)			CC				(16,533	)
															120				EE
Formation and operating costs			—				(6,742	)			6,742				—								—
Operating loss			(11,586	)			(6,742	)			—				(100,871	)							(119,199	)
Finance expenses			(751	)			—				—				204				GG				(9,530	)
															(158	)			HH
															(3,245	)			KK
															(4,730	)			MM
															(580	)			NN
															(270	)			OO
Finance income			8,163				—				2,775				(2,775	)			AA				8,163
Interest income – note receivable, net of original issuance discount			—				750				—				(750	)			FF				—
Interest expense – note payable, net of original issuance discount			—				(750	)			—				750				FF				—
Gain on initial recognition of Derivative Asset – Note Receivable			—				1,918				—				(1,918	)			FF				—
Change in fair value of Derivative Asset – Note Receivable			—				22				—				(22	)			FF				—

 

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